power system review - utilities commission power system review...projected available generation...

Level 9, 38 Cavenagh Street DARWIN NT 0800

Postal Address GPO Box 915 DARWIN NT 0801

Email: [email protected]

Website: www.utilicom.nt.gov.au

POWER SYSTEM REVIEW

2009-10

March 2011

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Table of Contents

Overview .................................................................................................................................................................. 1

Key findings ............................................................................................................................................................. 1

Generation adequacy ...................................................................................................................................... 1

Fuel supply ..................................................................................................................................................... 3

Electricity networks adequacy ......................................................................................................................... 3

Reliability ..................................................................................................................................................... 5

Customer service performance ....................................................................................................................... 5

Introduction .............................................................................................................................................................. 7

Overview of 2009-10 Review ................................................................................................................................... 7

Role of expert advisor...................................................................................................................................... 7

Availability of information ................................................................................................................................. 8

Structure and scope of Review ................................................................................................................................ 9

Electricity supply in the Territory ............................................................................................................................ 10

Introduction ............................................................................................................................................................ 10

Electricity industry participants ............................................................................................................................... 11

Market statistics ..................................................................................................................................................... 11

Industry developments and key events .................................................................................................................. 12

Priority work program .................................................................................................................................... 12

Natural gas supply ......................................................................................................................................... 12

Darwin-Katherine system black on 30 January 2010..................................................................................... 12

Generation investment program .................................................................................................................... 13

Subsequent developments ............................................................................................................................ 13

Electricity generation .............................................................................................................................................. 14

Generation capacity ............................................................................................................................................... 14

Generation supply-demand balance ...................................................................................................................... 17

Projected available generation capacity ........................................................................................................ 17

System demand forecasts ..................................................................................................................................... 19

Development of system demand forecast scenarios ..................................................................................... 20

Forecast system demand scenarios .............................................................................................................. 21

Generation supply-demand balance ...................................................................................................................... 24

Generation supply-demand balance – Darwin-Katherine system .................................................................. 26

Generation supply demand balance – Alice Springs ..................................................................................... 31

Generation supply demand balance – Tennant Creek .................................................................................. 33

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Fuel supplies .......................................................................................................................................................... 34

Natural gas supply ......................................................................................................................................... 34

Alternative fuel sources ................................................................................................................................. 34

Adequacy of fuel supplies .............................................................................................................................. 35

Electricity networks ................................................................................................................................................ 38

Scope of assessment and availability of data ................................................................................................ 38

Transmission and distribution networks in the Territory ......................................................................................... 38

Network infrastructure ................................................................................................................................... 39

Network capacity and constraints .......................................................................................................................... 41

Network peak demand forecasts ................................................................................................................... 42

Transmission/sub-transmission network capacity and constraints ................................................................ 42

Distribution network capacity and constraints ................................................................................................ 45

Customer service and reliability performance ........................................................................................................ 47

Reliability performance .......................................................................................................................................... 47

Overall reliability performance ....................................................................................................................... 47

Darwin region reliability performance ............................................................................................................ 54

Katherine region reliability performance ........................................................................................................ 55

Alice Springs region reliability performance ................................................................................................... 57

Tennant Creek reliability performance ........................................................................................................... 58

Customer service performance .............................................................................................................................. 60

Reconnections / connections ......................................................................................................................... 60

Quality of supply complaints .......................................................................................................................... 61

Telephone call response ............................................................................................................................... 61

Customer complaints ..................................................................................................................................... 61

Appendix A ................................................................................................................................... 63

System maximum demand forecasts 2010-11 to 2019-20 ..................................................................................... 63

Appendix B ................................................................................................................................... 65

Zone substation demand for 2007-08 to 2015-16 .................................................................................................. 65

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March 2011

Disclaimer

The Power System Review is prepared by the Utilities Commission in accordance with

section 45 of the Electricity Reform Act.

The Review is prepared using information sourced from participants of the electricity supply

industry, Northern Territory Government agencies, consultant reports, and publicly available

information. The Commission understands this information to be current as at March 2011.

The Review contains predictions, estimates and statements that are based on the

Commission’s interpretation of data provided by electricity industry participants, and

assumptions about the power system, including load growth forecasts and the affect of

potential major developments in particular power systems. The Commission considers that

the Review is an accurate report within the normal tolerance of economic forecasts.

Any person using the information in the Review should independently verify the accuracy,

completeness, reliability and suitability of the information and source data. The Commission

accepts no liability (including liability to any person by reason of negligence) for any use of

the information in this Review or for any loss, damage, cost or expense incurred or arising by

reason of any error, negligent act, omission or misrepresentation in the information in this

Review or otherwise.

Inquiries

Any questions regarding this report should be directed in the first instance to the Executive

Officer, Utilities Commission at any of the following:

Utilities Commission

GPO Box 915

DARWIN NT 0801

Telephone: 08 8999 5480

Fax: 08 8999 6262

Email: [email protected]

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March 2011

CHAPTER 1

Overview

1.1 The Commission’s annual Power System Review reports on power system

performance and capacity in the Northern Territory. The Review provides information

and analysis of historical and forecast power system performance, focusing on the

previous financial year, and on the upcoming 10 years.

1.2 This Review reports on actual system and network performance in 2009-10, and on

forecast system performance in the period 2010-11 to 2019-20.

1.3 The Commission engaged a consultant to assist the Commission to prepare the

2009-10 Review by providing expert advice on power system and distribution planning,

and reliability performance.

Key findings

1.4 Regular and comprehensive reporting on power system and distribution network

performance and health is a feature of the electricity supply industry elsewhere in

Australia.

1.5 The 2009-10 Review places an increased focus on electricity demand analysis. The

purpose is to provide a robust assessment of the adequacy of the power system (i.e.

generation) and the transmission and distribution networks (i.e. substations and lines).

1.6 The Commission is aware that electricity businesses operating elsewhere in Australia

have taken some time to establish the systems and processes required to meet

reporting requirements. Consequently, the Commission acknowledged from the outset

that not all the information requested from electricity industry participants in the

Territory, primarily the Power and Water Corporation (PWC), would be available for the

2009-10 Review.

1.7 The Commission expects PWC to provide a more comprehensive data set for the next

Review. In particular, the Commission expects that PWC will have improved demand

forecasts, with the PWC system (generation) demand forecasts available for the

2009-10 Review being too low for the purpose of assessing system adequacy. The

PWC networks demand forecasts appear more reasonable. The Commission notes

that the PWC is instituting information technology systems and business processes

that are intended to provide more complete asset performance information, and

improved electricity demand forecasting.

Generation adequacy

1.8 The generation supply-demand balance provides an assessment of generation

adequacy relative to forecast electricity demand in the Darwin-Katherine, Alice Springs

and Tennant Creek systems for the period 2010-11 to 2019-20.

1.9 Currently, a system is deemed to have adequate generation where there is sufficient

capacity available to maintain supply despite the loss of the two largest units of

generation plant, known as an N-2 event.

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March 2011

1.10 The Commission considers that further work is necessary to identify an optimum level

of generation capacity for the Territory’s power systems that recognises reliability

performance and cost objectives. The Commission considers that probabilistic analysis

of the adequacy of generation capacity is necessary. This is the approach most

commonly used in Australia for identifying the potential for capacity constraints, and is

a more useful measure for generation planning purposes than the N-X methodology.

Generation adequacy – Darwin-Katherine

• The Darwin-Katherine system is expected to have sufficient generation capacity to

maintain supply under any credible electricity demand scenario despite the loss of

the two largest generation units in the system (an N-2 event) from mid-2011 to

2019-20.

• There is a credible risk of generation capacity constraints and poor generation

reliability during 2011, particularly prior to the commissioning of Channel Island

power station sets 8 and 9 which PWC has advised is expected to occur during

April 2011. There is potential for ongoing capacity constraints if the new Channel

Island plant experiences commissioning problems or from forced outages of

existing plant.

• The capacity being maintained in the Darwin-Katherine system for the period 2012

to 2016 may be greater than is reasonably necessary to maintain reliability of

supply depending on factors such as plant condition, maintenance requirements

and operating practices.

• The need for the planned level of generation capacity and reserves could be

prompted by doubts about the condition and reliability of existing generation plant,

particularly at Channel Island. There seems to be a perceived risk of these assets

failing or not being available for extended periods due to extended maintenance,

but this assumption is not explicitly recognised in PWC Generation planning. It

should be reflected in planning assumptions for the timing and duration of planned

outages or by de-rating of existing capacity.

• If the apparent, but not clearly documented, concerns about the reliability and

availability of the older Channel Island sets prove warranted, the reported available

capacity may be less for extended periods because plant is off-line for

maintenance.

Generation adequacy – Alice Springs

• The Alice Springs system is expected to have sufficient generation capacity to

meet forecast peak demand under any credible electricity demand growth scenario

from mid-2011 to 2019-20.

• There is a credible risk of generation capacity constraints and poor generation

reliability during 2011. The key risk period is prior to the commissioning of Owen

Springs sets 1-3 which PWC has advised is expected to occur by March 2011.

There is the potential for ongoing capacity constraints if the new Owen Springs

plant experiences commissioning problems or from forced outages of existing

plant.

• The level of the available capacity in the Alice Springs system is influenced by the

timing of commissioning new capacity at Owen Springs and decommissioning of

capacity at Ron Goodin. The Commission considers that PWC should keep the

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March 2011

timing of the installation of new plant under review to optimise the amount of plant

installed or decommissioned on a yearly basis.

Generation adequacy – Tennant Creek

• The generation supply-demand balance in the Tennant Creek system is adequate

for the period to 2019-20.

• New capacity is expected to be commissioned in mid-2011, providing sufficient

capacity to meet an N-2 event for the period to 2019-20.

• Subject to industry standard operation and maintenance practices being followed,

generation capacity is sufficient to meet forecast demand, with a significant reserve

margin for the period January 2011 to June 2020.

Fuel supply

1.11 Natural gas is the main fuel for electricity generation in the Darwin-Katherine, Alice

Springs and Tennant Creek systems. However, a number of generation sets are dual

fuel, and able to use liquid fuels (i.e. diesel) as an alternative fuel source.

1.12 PWC has a range of contingency arrangements to maintain electricity supply in the

event of the partial or complete loss of the primary gas supply from Blacktip, with a

contingency supply arrangement with the Darwin liquid natural gas (LNG) plant,

linepack gas and diesel stocks.

1.13 These alternate fuel sources should provide access to a continued fuel supply to power

stations, even in the circumstances of partial or complete loss of gas from Blacktip due

to production or processing equipment failure or cyclonic activity or a pipeline rupture.

Electricity networks adequacy

1.14 For the 2009-10 Review, the Commission requested PWC Networks (as

owner/operator of the Darwin-Katherine, Alice Springs and Tennant Creek networks) to

provide equivalent information to that routinely reported by transmission and

distribution network operators in the national electricity market (NEM).

1.15 The Commission’s intention was to identify potential network capacity constraints in the

period 2010-11 to 2014-15:

• transmission/sub-transmission feeders that might exceed normal rating;

• bulk and zone substations that might exceed normal rating; and

• distribution feeders that might exceed normal rating.

1.16 Although routinely provided by network operators elsewhere in Australia, this is the first

time that PWC Networks has been requested to provide equivalent information. In

responding to the request, PWC Networks found that not all the information sought is

yet available.

1.17 This is not unexpected given the experience of network operators elsewhere in

Australia, and the Commission anticipates that PWC will take two or three years to

develop the systems and practices to collate and report the requested data. The

Commission expects to be able to provide a more comprehensive analysis of network

capacity and constraints in future Reviews.

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March 2011

Transmission network adequacy – lines

1.18 Based on the information available, a high level assessment of capacity and

constraints in the Darwin-Katherine system has been undertaken due to the criticality

of the transmission/sub-transmission network to security of supply.

1.19 The analysis indicates a potential capacity constraint in the Palmerston sub-system,

with potential overloading of the Hudson Creek-Palmerston and Hudson

Creek-McMinn’s 66 kV network under first contingency conditions (N-1) in 2012-13 and

2013-14. However, this constraint is expected to be relieved on the completion of

Archer zone substation. The potential for overloading may also be managed by using

the low voltage distribution network to transfer load.

1.20 The Commission cautions that the assessment relies on a number of simplifying

assumptions and is presented to provide a high level indication of capacity and

potential capacity constraints. The Commission expects to provide a more authoritative

assessment in future Reviews as the necessary data becomes available.

Transmission network adequacy – substations

1.21 There are 28 bulk and zone substations across the Darwin-Katherine, Alice Springs

and Tennant Creek systems, with an assessment of substation utilisation possible for

25 substations.

1.22 With all transformers in service, all zone substations should have sufficient capacity to

meet forecast load for 2010-11. The Snell Street zone substation faces an emerging

capacity constraint.

1.23 Under N-1 conditions (i.e. the loss of one transformer), five substations face capacity

constraints in 2010-11 and 2013-14.

• Berrimah 66/11 kV, with 99 per cent utilisation in 2010-11 and 2013-14. PWC

Networks is planning construction of a new East Arm substation (operating from

circa 2015-16) to support the Berrimah substation;

• Centre Yard 66/11 kV, with 100 per cent utilisation in 2010-11 and 120 per cent

utilisation in 2013-14. Centre Yard is a small (0.5 MVA) substation where PWC

Networks is considering supplementing capacity by relocating spare transformers;

• Palmerston 66/11 kV, with 115 per cent utilisation in 2010-11 and 97.5 per cent

utilisation in 2013-14. The Palmerston substation will be supported by the new

Archer zone substation (expected to be operational in 2011) and load transfer

through the low voltage distribution network;

• Katherine 132/22 kV, with 107 per cent utilisation in 2010-11 and 109 per cent

utilisation in 2013-14. The Katherine substation is supported by Pine Creek and

Katherine generation. Accounting for this generation should resolve the apparent

constraint; and

• Snell Street 66/11 kV, with 106 per cent utilisation in 2010-11 and 116 per cent

utilisation in 2013-14. Snell Street represents the most critical constraint due to its

role supplying the Darwin CBD. PWC Networks intends construction of a

replacement substation (operating from circa 2011-12).

1.24 The Commission notes that the poor condition of equipment at the City Zone and Snell

Street substations makes a multiple contingency event a possibility which warrants a

continued priority being given to the capital program associated with the development

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of Frances Bay substation, upgrade of Snell Street substation and replacement of City

Zone substation.

Distribution network adequacy

1.25 PWC Networks was not able to provide the load flow studies or measurements on the

low voltage (11/22 kV) distribution network necessary for an assessment of loading

and capacity. The Commission considers that availability of this data is important and

anticipates that PWC Networks will provide such information for future Reviews.

Reliability

1.26 The Commission has examined reliability for 2005-06 to 2009-10 for:

• generation and network performance in the Darwin region and Katherine region (of the Darwin-Katherine system), Alice Springs and Tennant Creek systems, using a weighted total average of reliability outcomes for each system; and

• central business district (CBD), urban, short rural and long rural feeders (for 2009-10 only), using a weighted total average of feeder reliability for each system.

Generation performance trend

1.27 Territory customers experienced an average of 2.7 generation related outages a year

(SAIFI) between 2005-06 and 2009-10. This is significantly more than observed in the

NEM connected systems (e.g. for the 12 months ended 31 March 2010, Ergon Energy

reported a SAIFI of 0.02).

1.28 The Commission expects generation reliability performance to improve in the coming

years with the commissioning of new generation plant (especially Channel Island sets

8 and 9) and the planned major maintenance to existing generation plant.

Network performance trend – feeder performance

1.29 Examining feeder performance to identify network performance trend is the accepted

approach in Australia. As 2009-10 is the first year this data has been reported, there is

no time series data to compare reliability performance in the Territory over time.

1.30 The Commission has compared feeder performance in the Territory for 2009-10 with

the minimum performance standards applicable to comparable network categories in

Queensland.

1.31 Overall, the PWC feeder performance is reasonable when compared with the

regulatory expectations in Queensland. However, the frequency of outages on long

rural feeders is markedly higher than the minimum performance standard for the

Queensland distributors. The Commission will report feeder performance in future

Reviews to assess feeder performance achieved in the Territory over time.

Customer service performance

1.32 The customer service performance of PWC Networks and PWC Retail is measured

using the following indicators:

• the time taken to complete reconnections and new connections;

• the number of complaints about quality of electricity supply;

• the time taken to answer telephone calls (after the customer has chosen to speak to an operator); and

• the number of complaints about PWC Networks and PWC Retail customer service.

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Reconnections/connections

• the number of reconnections (i.e. those typically made when someone moves into a new residence) occurring within 24 hours is greater than 99 per cent.

• the number of connections to a property in a new subdivision in an urban area occurring within five working days is 92.1 per cent, continuing the improvement in the number occurring in time from a low point of 80.7 per cent in 2006-07.

• the number of connections to a property in a new subdivision in an urban area where minor works are required occurring within 10 weeks is 30.6 per cent, which is worse than in 2008-09 and the worst result in the five year period.

Quality of supply complaints

• The number of quality of supply complaints has increased substantially in Katherine and Tennant Creek from 2008-09. No reason has been given to the Commission.

Telephone call response times

• The reported percentage of telephone calls to PWC answered within 20 seconds of the customer choosing to speak to a human operator was 63 per cent in 2009-10. This represents an improvement from 2008-09, but is below the 76 per cent achieved in 2005-06.

Customer complaints

• PWC received 2477 electricity service related complaints during 2009-10, the highest number received since 2005-06 (2907).

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CHAPTER 2

Introduction

2.1 The Commission’s annual Power System Review reports on power system

performance and capacity in the Northern Territory. The Review provides information

and analysis of historical and forecast power system performance, focusing on the

previous financial year, and on the upcoming 10 years.

2.2 The Review is prepared in accordance with the Electricity Reform Act [s45], which

requires the Commission to:

• report forecasts of electricity load and generating capacity;

• report on the performance of the Territory’s power systems;

• advise on matters relating to the future capacity and reliability of the Territory’s

power systems relative to forecast load;

• advise on other electricity supply industry and market policy matters; and

• review the prospective trends in the capacity and reliability of the Territory’s power

systems relative to projected load growth.

2.3 The Review relates only to the Darwin-Katherine, Alice Springs and Tennant Creek

power systems (referred to as the market systems).1

2.4 The Review is prepared with the assistance and advice of participants in the electricity

supply industry, other electricity industry stakeholders and consultant reports. The input

of all those who have contributed is appreciated, but the views expressed in the

Review are those of the Commission, and may not necessarily reflect those of the

parties consulted.

Overview of 2009-10 Review

2.5 This Review reports on actual system and network performance in 2009-10, and on

forecast system performance in the period 2010-11 to 2019-20.

2.6 The Commission engaged a consultant to assist the Commission to prepare the

2009-10 Review by providing expert advice on power system and distribution planning,

and reliability performance.

Role of expert advisor

2.7 The Commission engaged Evans & Peck2 to assist in development of the information

request to electricity industry participants, collecting relevant information, and providing

1 The activities of electricity industry participants and customers in the market systems are regulated under the Electricity Reform Act, Electricity Networks (Third Party Access) Act and Code and associated legislation.

2 Evans & Peck <www.evanspeck.com> is an infrastructure focused advisory company with over 350 employees,

and experience in economic regulation and pricing, and the planning, construction and operation of energy, water and resources projects and facilities. E&P is a subsidiary of the WorleyParsons Group.

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an assessment of the performance and capacity of the Territory’s power systems and

distribution networks. The advice provided by Evans & Peck to the Commission covers

four main areas:

• assessment of electricity demand and energy forecasts prepared by industry

participants;

• assessment of future capacity and reliability of the power systems and distribution

network;

• assessment of the performance of the Territory’s power systems and distribution

network; and

• advice on electricity supply industry practice.

2.8 In addition to the work of Evans & Peck, the 2009-10 Review draws on reports

prepared for the Commission during 2010.

Availability of information

2.9 The Commission requested Evans & Peck to develop an information request template

that detailed the information required from system participants for preparing the

2009-10 Review. The data specification was based on arrangements for reporting on

system and distribution network health in place elsewhere in Australia.

2.10 Regular and comprehensive reporting on power system and distribution network

performance and health is a feature of the electricity supply industry elsewhere in

Australia.

2.11 The Australian Energy Market Regulator (AER) publishes an annual State of the

Energy Market report to provide a high level overview of energy market activity in

Australia, and supplement the AER’s extensive technical reporting on the energy

sector. The Australian Energy Market Operator (AEMO) publishes detailed reports on

system planning and the operation of energy markets, notably the National

Transmission Network Development Plan, Electricity Statement of Opportunities report

and Power System Adequacy report. At the distribution network level, distribution

network service providers are generally required under jurisdiction specific obligations

to report on distribution planning and performance.

2.12 These reporting arrangements have developed over the past decade or more, during

which time industry participants have built their capacity to provide relevant

information.

2.13 The Commission is aware that electricity businesses operating elsewhere in Australia

have taken some time to establish the systems and processes required to meet

reporting requirements. Consequently, the Commission acknowledged from the outset

that not all the information requested from electricity industry participants in the

Territory, primarily the Power and Water Corporation (PWC), would be available for the

2009-10 Review.

2.14 The Commission expects PWC to provide a more comprehensive data set for the next

Review. In particular, the Commission notes that the PWC is instituting information

technology systems and business processes that are intended to provide more

complete asset performance information.

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Structure and scope of Review

2.15 The structure and scope of this Review is:

• Chapter Three provides some details of the Territory’s electricity industry;

• Chapter Four provides an assessment of the adequacy of electricity generation

supplies relative to forecast peak demand and an assessment of fuel supply

adequacy for the medium term (next three years to 2012-13) and long-term (next

10 years to 2019-20);

• Chapter Five provides an assessment of the adequacy of the electricity

transmission/sub-transmission and distribution networks capacity relative to

forecast peak demand for the period to 2013-14; and

• Chapter Six reports on customer service performance and reliability of supply.

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March 2011

CHAPTER 3

Electricity supply in the Territory

Introduction

3.1 This chapter provides details of the Territory electricity industry, noteworthy industry

developments and events in 2009-10.

Figure 3.1: Northern Territory energy supply infrastructure

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March 2011

Electricity industry participants

3.2 Electricity industry participants licensed to operate in the Darwin-Katherine, Alice

Springs and Tennant Creek power systems at 30 June 2010 are listed in Table 3.1.

Table 3.1: Electricity licence holders at 30 June 2010

Licensees Darwin-Katherine Alice Springs Tennant Creek

Generation

PWC Generation

NGD (NT) P/L

Cosmo Power P/L

LMS Generation P/L

PWC Generation

Central Energy Power

PWC Generation

Network PWC Networks PWC Networks PWC Networks

Retail PWC Retail PWC Retail PWC Retail

Source: Utilities Commission.

3.3 PWC generates most electricity for household and business use, operates the

electricity distribution networks and provides retail services to all customers in the

Darwin-Katherine, Alice Springs and Tennant Creek power systems.

3.4 PWC is a vertically integrated electricity supplier which also provides water supply and

sewerage services. The PWC generation, network and retail units operate as separate

businesses with internal transactions between units subject to oversight by the

Commission. PWC is owned by the Territory Government and is subject to oversight by

a shareholding Minister under the Government Owned Corporations Act.

3.5 The remaining industry participants are three generation businesses operating in the

Darwin-Katherine system, and one generation business operating in the Alice Springs

system. These four businesses generate electricity under power purchase agreements

with PWC.

Market statistics

3.6 Table 3.2 provides some key market statistics for the Darwin-Katherine, Alice Springs

and Tennant Creek power systems.

Table 3.2: Key market statistics at 30 June 2010

Darwin-Katherine Alice Springs Tennant Creek

Customers (connections) 59 355 11 876 1485

Generation capacity (MW) 404 72 17

Peak demand (MW) 273 55 7

Electricity sent out (GWh) 1516 229 30

Network length (km) 4829 607 385

Source: Power and Water Corporation. Figures rounded to nearest whole number.

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March 2011

Industry developments and key events

3.7 Industry developments and key events for 2009-10 are detailed below.

Priority work program

3.8 In August 2009, the Northern Territory Government requested the Commission

undertake a priority work program to increase the efficiency of PWC, improve customer

standards of service and reliability, and where possible, align the Territory electricity

industry with national electricity market practice.

3.9 The work program required the Commission to undertake a series of reviews under

terms of reference approved by the Treasurer. At the time of writing, four reviews are

complete, one is underway and one is yet to start:

• A Review of Full Retail Contestability for Northern Territory Electricity Customers

was started in August 2009. The final report for this Review was provided to the

Treasurer in December 2009 and released publicly in February 2010.

• A Review of Options for Implementation of a Customer Service Incentive Scheme

for Electricity Customers was started in March 2010. The final report was provided

to the Treasurer in July 2010 and released publicly in August 2010.

• A Review of Options for the Development of a Retail Price Monitoring Regime for

Contestable Electricity Customers started in March 2010. The final report was sent

to the Treasurer in October 2010, and released publicly in October 2010.

• A Review of Electricity Standards of Service was started in May 2010. The final

report sent to the Treasurer in November 2010, and released publicly in December

2010.

• A Review of System Planning, Monitoring and Reporting started in December

2010. The final report is to be provided to the Treasurer in mid 2011.

• A Review of Electricity System Planning and Market Operation Roles and

Structures is to start in April 2011. A final report is to be provided to the Treasurer

in mid 2011.

3.10 Each review has involved extensive analysis and consultation with electricity industry

participants, consumers and interest groups.

Natural gas supply

3.11 Natural gas from the Blacktip field in the Bonaparte Gulf was to be used for electricity

generation in the Territory from January 2009. However, construction delays attributed

to difficulties sourcing components and bad weather meant that gas was not available

until late 2009. Full specification gas was available from mid January 2010 in sufficient

quantities to meet electricity generation requirements.

Darwin-Katherine system black on 30 January 2010

3.12 On 30 January 2010, a lightning strike to the 132 kV transmission lines linking the

Channel Island power station and Hudson Creek zone substation led to a black out of

the entire Darwin-Katherine power system – a system black.

3.13 A system black is the most significant and disruptive event that can affect a power

system, and warrants a detailed analysis of the causes and response to identify

implications for system reliability and security.

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March 2011

3.14 The system black was investigated by the System Controller. The Commission

subsequently provided a separate report to industry participants and the Territory

Government, with an independent assessment of the event.

3.15 The Commission’s main observations about the event and the subsequent response

are:

• the system black was initiated by a lightning strike, but the customer related

impacts were made significantly worse by avoidable errors, such as equipment

failure, inadequate operating procedures and switching errors;

• the event resulted in all customers in the Darwin-Katherine system losing power.

Power was restored in Katherine within 30 minutes, with the rest of the system

gradually restored within 10 hours. The average customer interruption was about

five hours;

• if not for switching errors, Katherine and Pine Creek customers would probably not

have lost power, and Darwin customers would probably have been without power

for a much shorter period; and

• PWC is addressing the issues identified through the incident investigation,

including improving operating procedures and training.

Generation investment program

3.16 PWC Generation announced a major generation investment program in March 2010,

involving the installation at Channel Island power station of two 45 MW dual fuel

turbines. The new generation plant was to provide additional capacity to meet

increasing peak demand and to provide additional reserve capacity to allow major

maintenance on existing generation plant.3

3.17 The new generation plant was initially planned to be operating for the 2010-11 wet

season, but is now expected to be operating from April 2011.

Subsequent developments

3.18 The Commission notes that subsequent developments since July 2010 that will be

addressed in more detail in the 2010-11 Review:

• QEnergy Pty Ltd was granted an Electricity Retail Licence in February 2011.

QEnergy is a retailer in the National Electricity Market (NEM) with customers in

Queensland. The entry of QEnergy into the Territory’s electricity retail market

provides customers with a choice of retailer for the first time since 2002; and

• Alice Springs system black on 7 October 2010 when a generation related outage

caused all Alice Springs customers to lose power. The System Controller provided

the Commission with an investigation report on the incident.

3 Power and Water Corporation, media release, 31 March 2010, <www.powerwater.com.au>,

http://www.powerwater.com.au/newsroom/news_item/2010/rolls_royce_power_for_channel_island.

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CHAPTER 4

Electricity generation

4.1 This chapter examines the capacity and adequacy of electricity generation in the

Darwin-Katherine, Alice Springs and Tennant Creek systems, and reports:

• generation capacity at 30 June 2010;

• system demand forecasts for the medium term (to 2012-13) and long term (to

2019-20);

• the supply-demand balance for the system to 2012-13 and to 2019-20 (a projected

assessment of system adequacy), and actual and potential system constraints

related to generation capacity;

• the adequacy of generation capacity and the reserve margin to 2012-13 and

potential capacity to 2019-20, based on available, committed and proposed

generating capacity; and

• the adequacy of fuel supplies for electricity generation.

Generation capacity

4.2 Electricity supplied in the Darwin-Katherine, Alice Springs and Tennant Creek systems

is generated by PWC Generation and four other licensed generation suppliers with

agreements to supply PWC Generation.

4.3 Table 4.1 presents generation capacity figures as at 30 June 2010. The capacity

reported is the sustainable installed capacity figure for generation plant (i.e. the

capacity available under normal operating conditions).

Table 4.1: Generation capacity in the Darwin-Katherine, Alice Springs and Tennant Creek systems

Darwin Katherine Operator Capacity (MW) Fuel

Channel Island PWC 232 Natural gas/liquid fuel

Weddell PWC 86 Natural gas

Berrimah PWC 30 Liquid fuel

Katherine PWC 21 Natural gas/liquid fuel

Pine Creek NGD(NT)

Cosmo Power 34 Natural gas/liquid fuel

LMS Shoal Bay LMS Generation 1 Landfill gas

Total 404

15

March 2011

Alice Springs Operator Capacity (MW) Fuel

Ron Goodin PWC 59 Natural gas/liquid fuel

Owen Springs PWC 4 Natural gas/liquid fuel

Brewer Central Energy Power 9 Natural gas/liquid fuel

Total 72

Tennant Creek Operator Capacity (MW) Fuel

Tennant Creek PWC 17 Natural gas/liquid fuel

Total 17

Source: Power and Water Corporation. Figures are rounded to the nearest whole number.

Darwin-Katherine – 2009-10

4.4 Just over 82 per cent of total generation capacity is located in the Darwin-Katherine

system, with over 47 per cent at the Channel Island power station. The next most

significant power station in the market systems is the Weddell power station (also in

the Darwin-Katherine system), with about 17 per cent of capacity. About 15 per cent of

total generation capacity is located in the Alice Springs system and 3 per cent in the

Tennant Creek system.

4.5 The Channel Island power station has five dual fuel (gas and diesel) combustion

turbines (sets 1-5) with a capacity of 31.6 MW each, one gas fuelled combustion

turbine (set 7) with a capacity of 42 MW, and one steam turbine (set 6) which operates

as part of a combined cycle block, using the waste heat from sets 4 and 5, to provide

32 MW capacity.

4.6 Each of the sets at Channel Island represents almost 8 per cent of capacity in the

Darwin-Katherine system. The combined cycle block formed by sets 4, 5 and 6 can

produce 95 MW, representing about 23 per cent of capacity in the system.

4.7 Weddell power station has a capacity of 86 MW, comprising two gas fuelled turbines,

each with a capacity of 43 MW. Each set represents about 9 per cent of total capacity

in the Darwin-Katherine system.

4.8 Pine Creek power station, operated by NGD (NT) Pty Ltd and Cosmo Power Pty Ltd

(subsidiaries of Energy Developments Ltd), has 34 MW from three gas fuelled

combustion turbines and three dual fuel combustion turbines. The Pine Creek power

station supplies electricity to PWC Generation under a power purchase agreement.

4.9 Also supplying PWC Generation with electricity under a power purchase agreement in

the Darwin-Katherine system is LMS Generation Pty Ltd, which operates a 1.1 MW

land fill gas generation facility at the Darwin City Council Shoal Bay rubbish dump.

Alice Springs – 2009-10

4.10 Ron Goodin power station in Alice Springs has a capacity of 72 MW comprising three

diesel engines (sets 1, 2 and J) with a combined capacity of 4.7 MW, six dual fuel

engines (sets 3-8) with a combined capacity of 29.1 MW and four gas turbines (sets 9,

10, F and G) with a combined capacity of 25.8 MW.

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March 2011

4.11 There was a minor change to generation capacity in the Alice Springs system in

2009-10. Capacity at the Ron Goodin power station increased from 58.7 MW to

59.6 MW with the commissioning of a 0.9 MW diesel fuelled engine (set J).

4.12 Owen Springs power station in Alice Springs has a capacity of 3.9 MW, being a dual

fuel combustion turbine that was relocated from Ron Goodin in June 2009. Three dual

fuel combustion turbines, each with 10.9 MW of capacity were installed at the Owen

Springs power station during 2010, and are expected to begin supplying electricity in

the first quarter of 2011.

4.13 Once operating, the Owen Springs power station is intended to replace Ron Goodin

power station, where generating units will be retired gradually over the period to

2018-19.4

4.14 Brewer power station, operated by Central Energy Power Pty Ltd, has 8.5 MW from

four spark fired reciprocating engines. Brewer operates under a power purchase

agreement with PWC Generation.

4.15 Not mentioned in the 2008-09 Review, generation capacity in Alice Springs increased

in 2009 with a 0.3 MW photovoltaic system installed at the Crowne Plaza Alice Springs

as part of the Alice Springs Solar Cities program.5

4.16 This PV system is not included in calculations of system capacity because the

electricity is generated for use on site only. During optimal operating conditions, the

Crowne Plaza system is expected to reduce total system load by about 0.5 per cent.

Tennant Creek – 2009-10

4.17 The Tennant Creek power station has a capacity of 16.7 MW, comprising seven diesel

engines (sets 1-5 and 16) with a combined capacity of 8 MW, five gas engines (sets

10-14) with a combined capacity of 4.8 MW and a dual fuel turbine (set 15) with a

capacity of 3.9 MW.

Power purchase agreements

4.18 PWC Generation was supplied electricity during 2009-10 by four businesses licensed

to operate as independent power producers:

• in the Darwin-Katherine system, NGD (NT) Pty Ltd and Cosmo Power Pty Ltd

(subsidiaries of Energy Developments Ltd) operate Pine Creek power station;

• in the Darwin-Katherine system, LMS Generation Pty Ltd operates a land fill gas

generation facility at the Darwin City Council Shoal Bay rubbish dump; and

• in the Alice Springs system, Central Energy Power Pty Ltd operates Brewer Estate

power station.

4.19 These four firms currently operate generation equipment with a total capacity of about

44 MW, or potentially about 9 per cent of total generation capacity of the market

systems.

4 Power and Water Corporation website <www.powerwater.com.au>, viewed 10 February 2011,

http://www.powerwater.com.au/about_us/major_projects/owen_springs_power_station.

5 Alice Solar City website <www.alicesolarcity.com.au>, viewed 2 March 2011,

http://www.alicesolarcity.com.au/iconic-projects.

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March 2011

Generation supply-demand balance

4.20 The generation supply-demand balance is an assessment of whether available

generation capacity is adequate to meet forecast electricity demand. To make this

assessment the Commission has used:

• generation capacity projections for 2010-11 to 2012-13, and advice of generation

investment plans for 2013-14 to 2019-20; and

• electricity demand forecast scenarios for 2010-11 to 2019-20.

Projected available generation capacity

4.21 Generation capacity projections for the Darwin-Katherine, Alice Springs and Tennant

Creek systems for 2010-11 to 2012-13 are provided in the tables below.

4.22 The capacity projections are based on advice by industry participants to the

Commission of available capacity, planned generation additions and retirements in the

period 2010-11 to 2019-20. Capacity projections for the period 2013-14 to 2019-20 are

not reported due to uncertainty about outcomes versus plans. The Commission

cautions that the timing of additions and retirements of capacity may vary in response

to commercial priorities of electricity industry participants, construction or

commissioning delays and changing electricity peak demand forecasts.

4.23 The Commission will be seeking more specific estimates of generation commitments

and future generation capacity for the next Review. The information available for the

2009-10 Review on the timing of new capacity was generally limited to the estimated

year of commissioning. This is not sufficient to allow an informed assessment of the

within year supply-demand balance. Consequently, the Commission has made

assumptions about the likely month that new capacity will become available based on

available information and good industry practice.

Darwin-Katherine system

4.24 Table 4.2 provides the Commission’s assessment of generation capacity in the

Darwin-Katherine system for 2010-11 to 2012-13. The starting capacity of the

Darwin-Katherine system for 2010-11 is 404 MW.

Table 4.2: Darwin-Katherine capacity projections (MW) 2010-11 to 2012-13

Year (30 June) Retirements New capacity Total Capacity Comment

2010-11 37.5 86 452.5

Less Berrimah

Less Pine Creek B

Plus Channel Island sets 8&9

2011-12 - 54.1 506.6 Plus Weddell set 3

Plus Katherine set 4

2012-13 - - 506.6

Source: Power and Water Corporation and Utilities Commission.

4.25 PWC has advised that Berrimah power station will be removed from regular service in

2010-11, reducing the system capacity by 30 MW. The Commission has excluded

Berrimah power station from the calculation of available generation capacity for

2010-11 on the understanding that the equipment is aged, in poor condition and may

18

March 2011

not be available for service, even in an emergency situation. PWC advises that the

expiry of the Pine Creek B power purchase agreement in April 2011 will reduce

available capacity by a further 7.5 MW.

4.26 New capacity of 86 MW is expected to become available during 2010-11 with the

planned commissioning of Channel Island power station sets 8 and 9 from April 2011

with each providing 43 MW of capacity. The new plant was initially to be commissioned

by October 2010.6 PWC advises the Commission that the plant is to be commissioned

from April 2011.

4.27 New capacity of 54.1 MW is expected to become available in 2011-12 with the

commissioning of:

• Katherine power station set 4 in September 2011, adding 12 MW of capacity. This

timeframe is a Commission estimate. PWC advises that this set is to be relocated

from Ron Goodin power station (where it is currently designated as set 10) during

2011, but has not advised the timing of the set being decommissioned at Ron

Goodin or recommissioned at Katherine. The Commission has assumed the set will

be decommissioned once new capacity is available from Owen Springs power

station (March 2011), and that the relocation and upgrading will take four months;

and

• Weddell power station set 3 (42 MW) in early 2012. No definite advice is available

from PWC on the month of commissioning. The Commission has assumed set 3

will be available from January 2012.

Alice Springs system

4.28 The starting capacity of the Alice Springs system for 2010-11 is 72 MW.

Table 4.3: Alice Springs capacity projection (MW) 2010-11 to 2012-13


2010-11 14.1 33.7 91.6

Plus Owen Springs sets 1,2&3

Plus Uterne solar power station

Less Ron Goodin sets 10, F&G

2011-12 - - 91.6

2012-13 4.2 - 87.3 Less Ron Goodin set 3


4.29 New capacity of 32.7 MW is expected to become available in 2010-11 with the

commissioning of Owen Springs power station sets 1, 2 and 3 from March 2011, each

with 10.9 MW of capacity. PWC advises that electricity should be available from this

new plant in the first quarter 2011.7

4.30 As part of the Alice Springs Solar Cities program a 0.96 MW solar power station is

scheduled to be operating in Alice Springs from May 2011. The facility is owned by

6 Power and Water Corporation website, viewed 17 February 2011,

http://www.powerwater.com.au/newsroom/news_item/2010/rolls_royce_power_for_channel_island.

7 Power and Water Corporation website, viewed 17 February 2011,

http://www.powerwater.com.au/about_us/major_projects/owen_springs_power_station.

19

March 2011

Uterne Power Plant Pty Ltd, and all production is to be sold to PWC Generation under

a power purchase agreement.8

4.31 Also as part of the Solar Cities program a 0.2 MW photovoltaic system at the Alice

Springs Airport was commissioned in September 2010. This PV system is not included

in calculations of system capacity because the electricity is generated for use on site

only. Under optimal operating conditions the Alice Springs Airport system is estimated

to supply about 25 per cent of the airport electricity demand. 9

4.32 The new capacity becoming available in 2011 will offset a 14.1 MW reduction in

capacity from the planned retirement of Ron Goodin power station sets F (2 MW) and

G (2 MW), and the planned relocation of Ron Goodin power station set 10 (10 MW) to

the Katherine power station from April 2011. PWC has advised that the plant at Ron

Goodin will be decommissioned in 2010-11, but has not advised the month of

decommissioning. The Commission has assumed the set will be decommissioned once

new capacity is available from Owen Springs power station.

4.33 PWC advises that Ron Goodin set 3 (4.2 MW) is to be retired in 2012-13. The

Commission has assumed that the set will be decommissioned in January 2013. All

generation at Ron Goodin is to be gradually removed from service between 2010-11

and 2018-19.

Tennant Creek system

4.34 The reported starting capacity of the Tennant Creek system for 2010-11 is 16.7 MW.

Table 4.4: Tennant Creek capacity projection (MW) 2010-11 to 2012-13


2010-11 - - 16.7

2011-12 - 1.5 18.2 Plus set 17

2012-13 - - 18.2


4.35 PWC advises that 1.5 MW of new capacity will be commissioned at the Tennant Creek

power station from July 2011.

System demand forecasts

4.36 Electricity system demand is the generation capacity (in megawatts) required to meet

the electricity consumption (in megawatt hours) of customers at a point in time.

4.37 System demand is determined by household, business and industrial electricity

consumption patterns, which are influenced by weather, population growth and

household formation, economic growth and the development of energy intensive

industrial projects.

8 Alice Solar City website <www.alicesolarcity.com.au>, viewed 17 February 2011,

http://www.alicesolarcity.com.au/sites/default/files/Media%20Release%20-%20Uterne%20Solar%20Power%20Station%20announcement%2015%20Dec%202010.pdf.

9 Alice Solar City website <www.alicesolarcity.com.au>, viewed 17 February 2011,

http://www.alicesolarcity.com.au/iconic-projects.

20

March 2011

4.38 The focus of a system demand forecast is the expectation of maximum or ‘peak’

demand. Forecasts of peak demand are used to inform decisions about the

supply-demand balance and the management of the electricity system to ensure a

reliable and secure electricity supply:

• the system operator (the System Controller in the Territory) will use peak demand

forecasts to determine the generation capacity operating and in reserve that must

be available in the short term (e.g. in the next half hour and over the day) to meet

customer energy use; and

• system participants will use peak demand forecasts to develop their maintenance

program and to identify potential generation investment opportunities in the longer

term (e.g. in three years time).

Development of system demand forecast scenarios

4.39 System demand forecasts for Territory power systems are produced by:

• PWC, through its System Controller role, will develop demand forecasts to use to

ensure there is sufficient generation capacity available to meet demand as part of

the day to day operation of the power systems; and

• the Commission, which is required under the Electricity Reform Act [s45(1)(a)] to

develop forecasts of overall electricity load and generating capacity in consultation

with participants in the electricity supply industry.

4.40 PWC Generation, PWC Networks and PWC Retail (and any other generator and

retailer operating in the Territory) would also require system demand forecasts to

schedule maintenance, to identify potential generation investment opportunities,

potential network constraints and to inform estimates of energy sales.

4.41 PWC has been the sole market generator and sole retailer operating in the Territory,

which puts it in a unique situation for Australia of having access to comprehensive

information on historical and prospective peak demand and energy consumption.

4.42 For example, a new customer wanting to establish an energy intensive business

activity would necessarily approach PWC Retail to negotiate an electricity supply

contract. These negotiations would in some way involve PWC Generation and PWC

Networks, informing their understanding and expectations of future peak demand and

energy consumption in the power system, and decisions about the timing and location

of new generation investment.

4.43 In contrast, there is no longer any vertically integrated electricity business in the NEM

or the Western Australia south west interconnected system (SWIS). In these systems,

the independent market and system operator is responsible for developing a

coordinated and independent system demand forecast, based on information from all

market participants.10

10

The Australian Energy Market Operator prepares the Electricity Statement of Opportunities and Power System Adequacy documents for the NEM, available from <www.aemo.com.au>. The Independent Market Operator prepares an Electricity Statement of Opportunities document for the Western Australian SWIS, available from <www.imowa.com.au >.

21

March 2011

PWC system demand forecasts

4.44 For the 2009-10 Review, the Commission started with PWC system demand forecast

scenarios for the period 2010-11 to 2019-20 (prepared in late 2010) to develop

forecasts of demand for the period 2010-11 to 2019-20 for the Darwin-Katherine, Alice

Springs and Tennant Creek systems.

4.45 A range of quantitative and qualitative data was reviewed to determine if the PWC

forecasts represent credible system demand scenarios. The Commission has identified

a number of areas for continuous improvement, but notes that PWC is taking steps to

address some of the deficiencies in the forecasting process. The findings include:

• the information underpinning the system demand forecasts was not of the standard

that could be expected in support of the associated infrastructure investment

program;

• inconsistencies between top down and bottom up forecasts – that is, the overall

system demand forecast and the localised zone substation forecast;

• the forecasting process was poorly documented with the assumptions underpinning

forecasts not always apparent or specified; and

• the forecasting process lacked key elements considered routine according to good

industry practice, particularly weather correction of data and use of econometric

modelling.

4.46 Evans & Peck found that the PWC system demand forecasts for the purposes of

testing system adequacy for the period 2010-11 to 2019-20 are probably too low.

However, a conclusive opinion of system demand growth over the period requires a

comprehensive analysis using the elements common to the preparation of robust

demand forecasts.

4.47 The Commission expects that PWC will in the future develop a consolidated system

demand forecast that is sufficiently robust for the purposes of accurately assessing the

supply-demand balance, including by adopting forecasts that are management

sanctioned and confirmed by external review.

Forecast system demand scenarios

4.48 The Commission is adopting the Evans & Peck Medium system demand growth

scenario for assessing system adequacy in the Darwin-Katherine, Alice Springs and

Tennant Creek systems for the period 2010-11 to 2019-20. Table 4.5 compares the

Evans & Peck Medium scenario with the PWC Medium and High scenarios for the

period to 2010-11 to 2019-20.

Table 4.5: System demand growth scenarios for 2010-11 to 2019-20

Forecast demand growth

(% per annum) Medium (E&P) Medium (PWC) High (PWC)

Darwin-Katherine 2.8 2.2 2.6

Alice Springs 1.7 1.2 1.6

Tennant Creek 2.0 0.6 1.1

Source: Evans & Peck and Power and Water Corporation.

4.49 The Commission considers that the PWC demand forecast scenarios may be too low

for the purposes of assessing system adequacy, particularly for the period from

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March 2011

2015-16. However, the period 2015-16 to 2019-20 is outside the critical period for

identifying a shortfall in the supply-demand balance, and there remains sufficient time

to reconsider potential peak demand for that period and for system participants to

adjust future generation investment programs.

4.50 The Commission is aware that PWC is developing more effective forecasting

techniques and capability to improve the reliability of longer term demand forecasts.

4.51 The Evans & Peck Medium (the Commission’s baseline scenario), PWC Medium and

PWC High forecast system demand scenarios for the Darwin-Katherine, Tennant

Creek and Alice Springs systems are presented in charts 4.2, 4.3 and 4.4. Tables A.1,

A.2 and A.3 in Appendix A provide the forecast maximum demand for 2010-11 to

2019-20.

Chart 4.2: Forecast Darwin-Katherine annual maximum system demand 2010-11 to 2019-2020


23

March 2011

Chart 4.3: Forecast Alice Springs annual maximum system demand for 2010-11 to 2019-20


Chart 4.4: Forecast Tennant Creek annual maximum system demand for 2010-11 to 2019-20


4.52 The Evans & Peck Medium system demand growth scenario for Tennant Creek is

signficantly higher than the PWC High scenario. A reason could be that Evans & Peck

24

March 2011

does not have forward looking information about factors that might influence demand

growth in the small Tennant Creek system, such as building approvals and local

industry development. The Commission notes that the Evans & Peck projection is in

line with average annual demand growth for 2005-06 to 2009-10.

Major projects

4.53 Consistent with the methodology adopted by PWC, the Commission considers that

major energy using projects should be excluded from the forecasting process and

treated on a case by case ‘contingent’ project basis. The Commission considers that:

• major projects have varying impacts on energy infrastructure, depending on energy

intensity, onshore or offshore locations and the multiplier effects in the local

community;

• the Territory’s electricity system and distribution networks are relatively small, and

a major project can represent a significant percentage of generation capacity;

• these projects may have their own generation capacity, and may not require

electricity from the system; and

• there is considerable uncertainty about the timing of projects, due to factors such

as global markets, availability of finance and timing of local and national approvals

processes.

4.54 No major projects are factored into the PWC demand forecast scenarios for 2010-11 to

2012-13.

Generation supply-demand balance

4.55 The generation supply-demand balance provides an assessment of generation

adequacy relative to forecast electricity demand in the Darwin-Katherine, Alice Springs

and Tennant Creek systems for:

• the short to medium term – 2010-11 to 2012-13; and

• the medium to long term – 2014-15 to 2019-20.

4.56 The Commission has used two techniques to assess the generation supply-demand

balance:

• an N-X analysis of generation adequacy, which tests whether generation capacity

is adequate to meet peak system demand under the medium growth scenario at

N-X. This is the approach adopted by the Commission for previous Power System

Reviews; and

• for the Darwin-Katherine system only, a probabilistic analysis, which establishes a

loss of load probability (LOLP) to identify the likelihood of generation constraints

occurring over the assessment period. This is the approach most commonly

adopted for generation planning purposes in Australia.

N-X analysis of generation adequacy

4.57 An N-X analysis of generation adequacy involves progressively subtracting the largest

unit of capacity from total installed capacity. For example:

• N is the system capacity regarded as available for service;

• N-1 is the system capacity minus the largest unit of generation in the system; and

• N-2 is the system capacity minus the two largest units in the system.

25

March 2011

4.58 The N-X approach is a straightforward method for assessing the level of reserve

capacity and identifying actual or potential generation constraints at a point in time at a

given level of demand.

4.59 The Commission notes that the PWC Statement of Corporate Intent (SCI), which is a

contract between the shareholding Minister and PWC about technical and financial

performance, has used the N-2 criterion to establish the level of reserve capacity

required for each power system.

4.60 The Commission has identified the N-X capacity for the Darwin-Katherine, Alice

Springs and Tennant Creek systems for the period 2010-11 to 2019-20, based on

advice from system participants about future generation capacity. Table 4.6 provides

the capacity available in each system at N-1 and N-2 as at 31 December 2010.

Table 4.6: N-X capacity for 2010-11

N-X capacity (MW) N N-1 N-2

Darwin-Katherine 374.0 326.4 278.8

Alice Springs 71.1 59.4 49.3

Tennant Creek 16.7 12.8 11.3

Source: Utilities Commission. Note: the N-X capacities change over time as generation sets are added and replaced.

4.61 In the Darwin-Katherine system:

• N-1 is 47.6 MW, which represents the loss of 50 per cent of the capacity of the combined cycle block at Channel Island power station (i.e. the loss of one dual fuel turbine and 50 per cent of the steam turbine); and

• N-2 is 95.2 MW, which represents the loss of the combined cycle block at Channel Island power station.

4.62 In the Alice Springs system:

• N-1 is 11.7 MW, which represents the loss of set 9 at Ron Goodin power station; and

• N-2 is 21.8 MW, which represents the loss of set 9, and set 10 (10.1 MW) at Ron Goodin power station.

4.63 In the Tennant Creek system:

• N-1 is 3.9 MW, which represents the loss of set 15 at Tennant Creek power station; and

• N-2 is 5.4 MW, which represents the loss of sets 15 and 16 (1.5 MW) at Tennant Creek power station.

Loss of load probability

4.64 The LOLP is an indicator of generation reliability commonly used in Australia for

assessing system adequacy and generation planning purposes. The LOLP indicates

the probability that generation capacity will be insufficient to meet demand at some

point over some specific period. It is considered a more useful measure for planning

purposes than the N-X methodology.

4.65 A probabilistic analysis of the adequacy of generation capacity, such as the LOLP, has

not been previously applied by the Commission. PWC Generation does not currently

undertake any probabilistic analysis.

26

March 2011

Generation supply-demand balance – Darwin-Katherine system

4.66 The Darwin-Katherine system is expected to have sufficient generation capacity to

meet forecast peak demand under any credible demand growth scenario in the

medium and long term.

4.67 In the short term, there is a credible risk of generation capacity constraints and poor

generation reliability during 2011. The key risk period is prior to April 2011 and the

commissioning of Channel Island sets 8 and 9. There is the potential for ongoing

capacity constraints the expected commissioning date if the new Channel Island plant

experiences teething problems or from forced outages of existing plant.

4.68 For the period 2012 to 2019-20, there appears to be sufficient generation capacity

available to provide an estimated average reserve margin of 60 per cent. In the period,

January 2012 to April 2016, the average reserve plant margin is estimated at 73 per

cent. The minimum reserve plant margin in the period is 57 per cent in late 2015 when

forecast peak demand reaches 323 MW against capacity of 508 MW (representing

reserve capacity of 185 MW). This comfortably exceeds the N-2 criterion of 95.2 MW.

4.69 The supply-demand balance and generation adequacy is influenced by the current

maintenance program for 2010 to 2016 for generation plant in the Darwin-Katherine

system.11

4.70 Accounting for planned maintenance in the period January 2012 to April 2016 the

average reserve plant margin is estimated at 61 per cent. The minimum reserve plant

margin experienced in the period is 43 per cent in November 2015 when forecast peak

demand reaches 323 MW against available capacity of 461 MW (representing reserve

capacity of 138 MW). This exceeds the N-2 criterion of 95.2 MW.

4.71 The reserve plant margin being maintained in the Darwin-Katherine system for the

period 2012 to 2016 may be greater than what is reasonably necessary to maintain

reliability of supply depending on factors such as plant condition, maintenance

requirements and operating practices. The Commission considers that further work is

necessary to identify an optimum level of generation capacity to balance reliability

performance and cost objectives.

4.72 For example, if the Weddell set 3 (42 MW) planned for commissioning in early 2012 is

excluded from the supply-demand balance calculation (including accounting for

planned maintenance), the average reserve plant margin for January 2012 to

April 2016 is estimated at 47 per cent, with a minimum reserve plant margin of

30 per cent in late 2015 (representing reserve capacity of 96 MW). This just exceeds

the N-2 criterion of 95.2 MW.

4.73 The need for the planned level of generation capacity and reserves could be prompted

by doubts about the condition and reliability of existing generation plant, particularly at

Channel Island. If so, the Commission considers that these doubts should be reflected

in the generation maintenance program to recognise the availability and reliability of

generation plant and to support the generation capital investment program.

11

The PWC Generation, Generation North Five Year Maintenance Program for 2010-2016 was provided to Evans & Peck.

27

March 2011

N-X analysis – Darwin-Katherine

4.74 An N-X analysis of the supply-demand balance for the Darwin-Katherine system is

presented in Chart 4.5. The analysis assumes that peak demand increases according

to the Evans & Peck Medium scenario (2.8 per cent a year),12 that all capacity is

available (i.e. without accounting for planned maintenance), and that no capacity

additions are made after 30 June 2013. The key points are:

• there is sufficient capacity to meet an N-2 event only until April 2011;

• the commissioning of Channel Island sets 8 and 9 from April 2011 provides

sufficient capacity to meet in excess of an N-2 event until 2019-20; and

• the commissioning of Weddell set 3 from January 2012 provides sufficient capacity

to meet in excess of an N-2 event (between January 2012 to April 2016) or the loss

of 181.2 MW.

Chart 4.5: Darwin-Katherine system supply-demand balance for 2010-11 to 2019-20

Source: Evans & Peck and Utilities Commission.

4.75 The potential for capacity constraints to cause adverse reliability outcomes during 2011

will remain a concern until the successful commissioning of sets 8 and 9, including

resolving any commissioning problems that may occur with new plant. The effect on

reliability associated with new plant is exampled by the reliability problems experienced

when PWC generation was bringing Weddell power station into service in 2008-09.

12

The Commission performed a sensitivity test of the implications for the supply-demand balance of demand growth of 3.5 per cent a year, finding that the higher demand growth scenario had no appreciable adverse affect on generation adequacy relative to the chosen demand growth scenario until about 2016.

28

March 2011

4.76 Subject to industry standard operation and maintenance practices being followed,

generation capacity should be sufficient to provide spare capacity above the N-2

criterion from January 2012 to 2019-20 under credible demand forecast scenarios.

Reserve plant margin

4.77 An alternative indicator of system adequacy is the reserve plant margin, which is

calculated as the total system capacity available less the actual maximum demand for

electricity in a particular year, expressed as a percentage of maximum demand.

4.78 The Commission does not yet have a view on an appropriate benchmark reserve plant

margin for each Territory power system. Evans & Peck advised that a starting point

benchmark for a small power system is upwards of 20 per cent, subject to factors

including the size of individual plant relative to total system load.

4.79 The Darwin-Katherine system (accounting for planned outages) has an estimated

average reserve plant margin of 65 per cent for the period July 2011 to June 2013, and

of 50 per cent for the period July 2011 to June 2020. The reserve plant margin reaches

a minimum of 21 per cent in late 2019, and is above 50 per cent until July 2011 to

March 2015.

4.80 Chart 4.6 presents the estimated probability of the Darwin-Katherine reserve plant

margin falling below 20 per cent in the period 2010-11 to 2019-20.

Chart 4.6: Probability of a Darwin-Katherine system reserve plant margin of below 20 per cent 2010-11 to

2019-20

Source: Evans & Peck.

Darwin-Katherine system LOLP

4.81 To supplement the N-X analysis of adequacy in the Darwin-Katherine system, the

Commission has assessed the LOLP, using a LOLP of a one day loss in 10 years (or

0.027 per cent) as the benchmark of a reliable system. A LOLP greater than 0.027 per

cent is indicative of an unreliable system.

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March 2011

4.82 Evans & Peck developed a simple probabilistic model for the Darwin-Katherine system

to complement the N-X analysis of generation adequacy. The Commission stresses

that this LOLP assessment has limitations, with additional information required to

reflect good industry practice, and provide a robust planning tool. However, the

Commission seeks to encourage participants in the Territory’s electricity sector to use

probabilistic analysis as the primary tool for assessing system adequacy and

generation planning purposes.

4.83 Chart 4.6 shows that the LOLP for the Darwin-Katherine system for the period 2010-11

to 2019-20 is generally at an acceptable level, except for the period to July 2011 prior

to Channel Island sets 8 and 9 entering service, and towards 2020 as load growth

erodes the reserve plant margin.

Chart 4.7: Darwin-Katherine system loss of load probability (LOLP) 2010-11 to 2019-20


4.84 The annual average LOLP are presented in Table 4.7. Years where the average is

greater than the benchmark of 0.027 per cent are shaded.

Table 4.7: Darwin-Katherine system average annual LOLP for 2010-11 to 2019-20

Period LOLP (%) Period LOLP (%)

2011 0.15 2016 0.00

2012 0.00 2017 0.04

2013 0.00 2018 0.025

2014 0.00 2019 0.06

2015 0.00 2020 0.008


30

March 2011

4.85 Table 4.7 (with charts 4.6 and 4.7) highlight that the most critical period for potential

poor generation reliability in the Darwin-Katherine system is the first three months of

2011 or until Channel Island sets 8 and 9 are operating, and then from 2017.

Implications of generation plant condition and the maintenance program

4.86 Planned and unplanned outages could have a significant influence on the incidence of

generation constraints and poor reliability performance until Channel Island sets 8 and

9 are in service.

4.87 Historical generation reliability performance suggests that maintaining a reliable system

under N-2 conditions is not guaranteed. As noted in the PWC 2010-11 Statement of

Corporate Intent:13

…ongoing investigations have found that the previous estimates of the residual life of

many assets may have been optimistic and that additional urgent refurbishment or

replacement of key assets is needed….Because of increasing reliability issues with

generation assets, a revised Generation capital investment strategy was developed

and approved in February 2010.

4.88 Chart 4.8 presents the generation supply-demand balance for the Darwin-Katherine

system, with capacity adjusted to exclude generation plant not available due to

scheduled maintenance.

Chart 4.8: Darwin-Katherine supply-demand balance for 2010-11 to 2019-20 (with planned maintenance)


13

Power and Water Corporation, 2010-11 Statement of Corporate Intent, page 24.

31

March 2011

4.89 The maintenance schedule used by Evans & Peck to determine available capacity in

each month was provided by PWC Generation. The Commission cannot comment on

the detail of the maintenance program, but notes that variation to the timing and

duration of planned maintenance could have implications for generation constraints

and reliability performance, particularly during 2011.

4.90 Similarly, unplanned outages due to plant failure could have adverse implications for

generation reliability performance during 2011. The Commission notes that new plant

can experience initial teething problems in construction or commissioning, which could

delay the new capacity (Channel Island sets 8 and 9, Weddell set 3) becoming

available for service. Consequently, the Commission considers there is an ongoing

credible risk of generation capacity constraints during 2011, and potentially into 2012.

Concluding comments – Darwin-Katherine system adequacy

4.91 A central concern of the Commission is that the generation capital and maintenance

programs may not be aligned. It is understood that the capital program is intended to

provide additional capacity to meet increasing demand, but also in case of higher

failure rates and extended outages for maintenance due to the not completely known

(but expected to be poor) condition of generation plant at Channel Island.

4.92 There seems to be a perceived risk of these assets failing or not being available for

extended periods due to extended maintenance, but this assumption is not explicitly

recognised in PWC Generation planning. It should be reflected in planning

assumptions for the timing and duration of planned outages or by de-rating of existing

capacity. If the apparent, but not clearly documented, concerns about the reliability and

availability of the older Channel Island sets prove warranted, the reserve margin may

be less for extended periods because plant is off-line for maintenance.

Generation supply demand balance – Alice Springs

4.93 The Alice Springs system is expected to have sufficient generation capacity in the

medium and long term to meet forecast peak demand under any reasonable demand

growth scenario.

4.94 In the short term there is a credible risk of generation capacity constraints and poor

generation reliability during 2011. The key risk period is prior to the commissioning of

Owen Springs sets 1-3, expected in March 2011. There is the potential for ongoing

capacity constraints after March 2011 if the new Owen Springs plant experiences

teething problems from forced outages of existing plant.

4.95 For the period 2012 to 2019-20 there appears to be sufficient generation capacity

available to provide an estimated average reserve plant margin of 77 per cent, with a

minimum reserve plant margin of 42 per cent in late 2017 when forecast peak demand

reaches 63 MW against capacity of 90 MW (representing reserve capacity of 27 MW).

This exceeds the N-2 criterion of 22.6 MW.

4.96 The level of the reserve plant margin for the Alice Springs system is influenced by the

timing of commissioning new capacity at Owen Springs and decommissioning of

capacity at Ron Goodin. PWC Generation has not provided a clear timetable (month

and year) for commissioning/decommissioning of plant. The timing of the installation of

new plant should be kept under review to optimise the amount of plant installed on a

yearly basis.

4.97 PWC Generation has not provided the Commission with a maintenance program for

generation plant in the Alice Springs system. The number and duration of planned

32

March 2011

outages may have an effect on the supply-demand balance and the assessment of

generation adequacy.

N-X analysis – Alice Springs system

4.98 An N-X analysis of the supply-demand balance for the Alice Springs system is


to the Evans & Peck Medium demand growth scenario (1.7 per cent a year) and that all

capacity is available (i.e. without accounting for planned maintenance). The key points

are:

• there is sufficient capacity to meet an N-1 event only until March 2011; and

• after the commissioning of Owen Springs sets 1-3 from March 2011, there is

sufficient capacity to meet an N-2 event until 2019-20, subject to the timing of

commissioning/decommissioning of plant.

Chart 4.9: Alice Springs system supply-demand balance for 2010-11 to 2019-20


4.99 The average reserve plant margin for the Alice Springs system for July 2011 to

December 2020 is 77 per cent. The average reserve plant margin for July 2011 to June

2013 is 78 per cent. The estimated minimum reserve plant margin is 27 per cent in the

January to March 2011, and then 42 per cent in late 2017.

Concluding comments – Alice Springs system adequacy

4.100 There is a potential for capacity constraints and adverse generation reliability during

2011, especially if the new plant at Owen Springs experiences teething problems.

4.101 The period 2012-2013 to 2015-16 requires monitoring to ensure that generation

constraints do not occur. Such constraints, if they appear likely, could be managed

33

March 2011

through maintaining plant in service at Ron Goodin, or advancing commissioning of

plant at Owen Springs.

4.102 The supply-demand balance for the period 2010-11 to 2019-20 is subject to the

scheduled commissioning/decommissioning program for plant at Owen Springs and

Ron Goodin, and the generation plant maintenance program. The Commission

requires more detailed information about these programs to confidently comment on

generation adequacy over the review period.

Generation supply demand balance – Tennant Creek

4.103 The generation supply-demand balance in the Tennant Creek system is adequate for

the period to 2019-20.

N-X analysis – Tennant Creek system

4.104 An N-X analysis of the supply-demand balance for the Tennant Creek system is


to the Evans & Peck Medium demand growth scenario (2.0 per cent a year) and that all

capacity is available (i.e. without accounting for planned maintenance).

4.105 The key points are:

• new capacity of 1.5 MW is expected to be commissioned in mid 2011; and

• there is sufficient capacity to meet an N-2 situation for the period 2010-11 to

2019-20.

Chart 4.10: Tennant Creek system supply-demand balance for 2010-11 to 2019-20


4.106 The estimated average reserve plant margin for the Tennant Creek system for the

period January 2011 to June 2013 is 161 per cent, with an estimated minimum reserve

margin of 122 per cent in the period January to May 2011.

34

March 2011

4.107 The estimated average reserve plant margin for the period January 2011 to June 2020

is 149 per cent, with a minimum of 102 per cent in early 2020.

Concluding comments – Tennant Creek system adequacy

4.108 Subject to industry standard operation and maintenance practices being followed,

generation capacity is sufficient to meet forecast demand, with a significant reserve

margin for the period January 2011 to June 2020.

Fuel supplies

4.109 Natural gas is the main fuel for electricity generation in the Darwin-Katherine, Alice

Springs and Tennant Creek systems. However, a number of generation sets are dual

fuel, and able to use liquid fuels (i.e. diesel) as an alternative fuel source.

Natural gas supply

Amadeus Basin gas fields

4.110 Natural gas originally from the Palm Valley field and subsequently from the Mereenie

field in the Amadeus Basin in central Australia has been the main fuel for electricity

generation in the Territory for many years, starting with Alice Springs in 1983. Gas has

been used for electricity generation in the Darwin-Katherine and Tennant Creek

systems since 1987 following the commissioning of the Amadeus Basin to Darwin gas

pipeline (now termed the Amadeus gas pipeline or AGP) in December 1986.

4.111 The Palm Valley and Mereenie fields have declining reserves, and have not been able

to supply sufficient gas since late 2008 for all electricity generation requirements in the

Darwin-Katherine system in addition to supplying the smaller Alice Springs and

Tennant Creek systems.

4.112 The Palm Valley field is operated by Magellan Petroleum Australia Ltd and the

Mereenie field by Santos Ltd. Together these companies own both fields outright.

4.113 Under gas supply contracts between Magellan and Santos, and PWC (through Gasgo

Pty Ltd, a PWC subsidiary), supply from the Mereenie field ceased generation from

December 2009, while supply from the Palm Valley field will cease in January 2012.

Blacktip gas field

4.114 The Blacktip gas field is located in the Bonaparte Gulf about 100 km west of Wadeye,

and is owned and operated by Eni Australia B.V. (Eni). The field has been developed

to supply gas to PWC for electricity generation to replace the Amadeus Basin fields.

PWC and Eni entered a 25 year gas supply arrangement in 2006 for the supply of 740

petajoules of gas from Blacktip field plus additional gas if required and available.

4.115 The first gas from Blacktip was supplied in October 2009. The gas comes onshore to

Eni’s gas processing plant near Wadeye, and is transported by APA Group’s 286 km

Bonaparte gas pipeline (BGP) to join the AGP at Ban Ban Springs.

4.116 For the period to 2019-20, the volumes of gas available under the PWC/Eni gas supply

contracts are considered sufficient to meet forecast electricity demand.

Alternative fuel sources

4.117 Leaving aside any remaining uncontracted reserves in the Amadeus Basin fields, there

are two alternative fuel sources for electricity generation – natural gas from the Darwin

35

March 2011

liquefied natural gas (DLNG) facility at Wickham Point on Darwin harbour and liquid

fuels (i.e. diesel).

Contingency gas supply

4.118 PWC agreed a contingency gas supply arrangement with DLNG in 2009 involving the

supply of a quantity of gas from the DLNG plant to the Darwin city gate gas hub in

certain defined circumstances. This arrangement operated successfully in 2009-10 to

assist PWC Generation to make up some of the shortfall in gas supply from the

declining Amadeus Basin fields.

4.119 The DLNG plant and Blacktip production and processing systems are geographically

separate, thereby reducing the risk of both supply sources being impacted

simultaneously by cyclonic activity or other natural disaster.

Contingency diesel supply

4.120 PWC Generation maintains a portfolio of generation plant able to use diesel as a last

resort contingency if gas is not available, and has significant diesel storage facilities at

Channel Island, Katherine and Tennant Creek power stations, and in Alice Springs.

4.121 Based on advice from PWC Generation, the diesel only capacity of each system is:

• 211.3 MW for the Darwin-Katherine system, against a peak demand of 273.4 MW

in 2009-10;

• 63.5 MW for the Alice Springs system, against a peak demand of 54.9 MW in

2009-10; and

• 11.9 MW for the Tennant Creek system, against a peak demand of 7.4 MW in

2009-10.

4.122 PWC Generation advises that the diesel stocks at Channel Island are sufficient to meet

two days of diesel only operation. Diesel stocks in Alice Springs and Tennant Creek

are sufficient to meet four days of diesel only operation.

Adequacy of fuel supplies

4.123 PWC has advised the Commission that its maximum daily requirement for 2009-10

was about 79 terajoules (TJ), compared to an average daily requirement of 61 TJ

(which translates into approximately 22 PJ a year).14 The annual quantity of gas to be

supplied from the Blacktip field over the 25 year term of the contract ranges from 23 PJ

to 37 PJ per year.15

4.124 The gas volumes available from the Blacktip field are projected to be sufficient to meet

gas demand to well beyond the review period to 2019-20.

4.125 In particular, the commissioning of more efficient generation plant in the

Darwin-Katherine and Alice Springs systems should result in significant improvements

in thermal efficiency and a decrease in the quantity of fuel consumed per unit of

electrical output. PWC expects the average heat rate to decrease by 16 per cent for

Darwin-Katherine and 24 per cent for Alice Springs between 2009-10 and 2014-15.

This should offset any increase in gas demand resulting from increased electricity

14

1000 terajoules equal 1 petajoule.

15 Press article, Blacktip gas feed in pipeline soon, Northern Territory News, 18 August 2008.

36

March 2011

demand in the period to 2014-15, and provide a continuing fuel efficiency benefit to

2019-20.

Adequacy of contingency arrangements

4.126 PWC has a range of contingency arrangements to maintain electricity supply in the

event of the partial or complete loss of the primary gas supply from Blacktip:

• DLNG gas. The DLNG contingency gas supply arrangement does not represent a

complete replacement supply to Blacktip. However, the DLNG gas would provide a

second gas supply in the event of pipeline rupture or temporary

production/processing problems that should reduce or eliminate the need to use

diesel for electricity generation;

• linepack gas, which is gas stored in the pipeline. Linepack gas may be sufficient to

provide a short term (i.e. possibly a few days) source of supply if there is a

disruption to the primary supply, particularly if there is forewarning so the pipeline

can be brought to its maximum operating pressure. The Commission understands

that the volume of linepack that can be made available from the AGP is being

assessed by the pipeline operator; and

• diesel stocks held by PWC provide a last resort fuel source for dual fuel or diesel

burning sets.

4.127 These alternate fuel sources should provide access to a continued fuel supply to power

stations, even in the circumstances of partial or complete loss of gas from Blacktip due

to production or processing equipment failure or cyclonic activity or a pipeline rupture.

4.128 The critical risk to the adequacy of fuel supplies is an extended gas outage due to a

pipeline rupture or production problems requiring PWC to rely solely on diesel. In this

situation, transport and storage constraints (at power stations, bulk fuel terminals in the

Territory and available road tankers) could lead to a gradual decline in diesel stocks as

they may not be able to be replenished at the same rate as they are used.

4.129 However, the availability of Blacktip, DLNG gas and linepack gas are considered to

provide sufficient diversity of supply to ensure adequate fuel supplies are available to

avoid prolonged use of diesel.

4.130 Under the extreme and unlikely scenario of a double event, the rupture of the Amadeus

Basin-Darwin pipeline close to the Channel Island power station cutting off gas supply

to the generation plant and supply from Blacktip being unavailable, gas should be

available from DLNG to Weddell, Katherine and Pine Creek power stations. In such a

case, gas fired capacity would be about 140 MW (increasing to 180 MW with the

proposed additional unit at Weddell in 2011-12). From April 2011, the Channel Island

power station will have 235 MW of dual fuel (diesel) capacity at N-1 contingency and

280 MW at full capacity.

4.131 The most disruptive (and quite unlikely) event for Alice Springs and Tennant Creek

would be a rupture of the supply pipeline near the power stations. It is expected that

the four day diesel fuel stocks would in almost all circumstances be sufficient to cover

the duration of repairs to the pipeline. Moreover, diesel fuel supply could be

supplemented by road from local terminals.

37

March 2011

Pipeline transportation

4.132 Firm gas transportation entitlements in both the AGP, the spur pipeline from DLNG and

BGP are understood to match the PWC gas purchase entitlements, which exceed

current and projected peak flow rates for the period of this review.

38

March 2011

CHAPTER 5

Electricity networks

5.1 This chapter examines the capacity and adequacy of the Darwin-Katherine, Alice

Springs and Tennant Creek transmission and distribution networks:

• network capacity (firm delivery capacity and demand) at 30 June 2010;

• network demand forecasts for 2010-11 to 2014-15, and forecast capacity and firm

delivery capacity at the sub-transmission and zone substation level;

• the supply-demand balance and supply-demand outlook at the sub-transmission

and zone substation level to 2013-14, and actual and potential constraints related

to sub-transmission assets and zone substations; and

• feeders that have exceeded in 2009-10, or are expected to exceed in 2010-11,

their normal operating conditions.

Scope of assessment and availability of data

5.2 For the 2009-10 Review, the Commission has expanded the scope of the assessment

of the network by requesting PWC Networks business unit (as owner/operator of the

Darwin-Katherine, Alice Springs and Tennant Creek networks) to provide equivalent

information to that routinely reported by transmission and distribution network

operators in the NEM.

5.3 Although routinely provided by network operators elsewhere in Australia, this is the first

time that PWC Networks has been requested to provide equivalent information. In

responding to the request, PWC Networks found that not all the information sought is

yet available.

5.4 This is not unexpected given the experience of network operators elsewhere in

Australia, and the Commission anticipates that PWC Networks will take two or three

years to establish the systems and processes necessary to routinely record the

relevant information.

5.5 The Commission expects that the implementation across each PWC business unit in

2011 of new information technology systems and business processes through the

PWC Asset Management Capability project will expedite the availability of the

comprehensive and detailed network asset information required for an effective

assessment of network capacity and adequacy.

Transmission and distribution networks in the Territory

5.6 The Darwin-Katherine, Alice Springs and Tennant Creek networks are subject to the

third party access regime established by the Territory’s Electricity Networks (Third

39

March 2011

Party Access) Act and Code, which provides a framework for setting the conditions of

service and charges for transporting electricity over the network.16

5.7 The Commission is responsible for determining the network conditions and charges,

and monitoring and enforcing compliance with the determination. The arrangements for

the period 1 July 2009 to 30 June 2014 were determined in March 2009.17

Network infrastructure

5.8 The PWC Networks business unit operates the Darwin-Katherine, Alice Springs and

Tennant Creek transmission and distribution networks, which comprise the poles,

wires, substations, transformers, switching, monitoring and signalling equipment

involved in transporting electricity from the generator to the customer.

5.9 The transmission and distribution network control function is undertaken by the System

Controller, and the PWC System Control business unit which is a part of PWC

Networks. The System Controller has statutory responsibilities for monitoring and

controlling the operation of the system and network to ensure a reliable, safe and

secure electricity supply.18

5.10 Table 5.1 provides some key details of the Territory’s transmission and distribution

network infrastructure, and operating characteristics.

Table 5.1: Transmission and distribution network characteristics

System/network Darwin-Katherine Alice Springs Tennant Creek

Connections (customers at 30 June 2010)

Household 50 589 9956 1193

Government 471 95 27

Business 8295 1825 265

Energy use (GWh for 2009-10) 1516 229 30

Transmission/sub-transmission network (km

at 30 June 2010) 666 0 0

Distribution network (km at 30 June 2010) 4164 607 385

Zone substations (number at 30 June 2010) 24 3 1

Distribution substations (number at 30 June

2010) 4037

Source: Power and Water Corporation. Note: the transmission/sub-transmission network is defined as 66 kV and above.

16

The Territory’s regional and remote networks are not subject to the third party access framework and the Commission has no role in setting conditions of service and charges. These networks transport electricity to customers in the 72 communities and 82 outstations where essential services are provided through the Territory Government Indigenous Essential Services program; eight remote townships and three mining townships.

17 Utilities Commission, March 2009, Final Determination Networks Pricing: 2009 Regulatory Reset.

18 Electricity Reform Act, s38. The functions and duties of the System Controller are detailed in the System

Control Technical Code and Network Connection Technical Code.

40

March 2011

5.11 A transmission/sub-transmission network overlay exists in the Darwin region to

transport electricity produced at three power station locations (Channel Island, Weddell

and Berrimah) to primary load centres via two 132 kV transmission lines and seven

66 kV zone substations. This transmission network is also connected with power

stations and loads at Pine Creek and Katherine via a 132 kV line from the Channel

Island power station.

5.12 A schematic of the Darwin-Katherine transmission and distribution network is

presented in Figure 5.1.

Figure 5.1: Darwin-Katherine transmission and distribution network

Source: Utilities Commission and Power and Water Corporation.

5.13 Electricity generated in the Alice Springs and Tennant Creek systems has been

supplied directly into the distribution network. However, a transmission network overlay

is being developed in Alice Springs, with electricity produced at the Owen Springs

power station to be supplied into the distribution network via a 66 kV transmission line

and two 66 kV zone substations (Owen Springs and Lovegrove).

Hudson Creek 66 kV

Snell Street

City Zone

Francis Bay

Berrimah

Casuarina

Archer

Weddell

Power Station McMinn

Palmerston

Marrakai

Humpty Doo

Mary River

Batchelor

Manton

Katherine

Power Station

Hudson Creek 132 kV

Channel Island

Power Station

Pine Creek

Power Station

132 kV 66 kV

41

March 2011

SADADEEN Ron Goodin

Power Station

Brewer Power

Station

Lovegrove 66Kv

Lovegrove

Owen Springs

Owen Springs Power Station

5.14 A schematic of the Alice Springs transmission and distribution network is presented in

Figure 5.2.

Figure 5.2: Alice Springs transmission and distribution network


Network capacity and constraints

5.15 The Commission sought advice from PWC Networks on forecast network peak

demand and the capacity of transmission/sub-transmission feeders, distribution

feeders, and substations. The Commission’s intention was to identify potential network

capacity constraints in the period 2010-11 to 2014-15:

• transmission/sub-transmission feeders that might exceed normal rating. Identifying

potential feeder constraints requires rating and loading data. No loading data was

available for transmission/sub-transmission feeders;

• bulk and zone substations that might exceed normal rating. Identifying potential

substation constraints requires rating and loading data. This information was

available for bulk and zone substations; and

• distribution feeders that might exceed normal rating. Identifying potential feeder

constraints requires rating and loading data. No rating or loading data was

available for distribution feeders.

5.16 PWC Networks was not able to provide all the information necessary to identify

potential transmission/sub-transmission or distribution feeder constraints, but is

expected to have the capability to do so in future. As such, the Commission expects to

be able to provide a more comprehensive analysis of network capacity and constraints

in future Reviews.

22 kV

11 kV

66 kV

42

March 2011

Network peak demand forecasts

5.17 Network demand forecasts are influenced by energy consumption patterns in the

substation service area. Therefore, a whole of network demand forecast is the

aggregate of forecast loading/demand for individual substations, which is determined

by factors including household and business energy use patterns, and residential and

commercial developments.

5.18 Appendix B presents information from PWC Networks on actual and forecast zone

substation demand and capacity for 2007-08 to 2015-16.

5.19 The aggregate Darwin-Katherine network demand growth for 2011-12 to 2014-15 is

presented in Table 5.2.

Table 5.2: Annual average network peak demand for the Darwin-Katherine system

Aggregate substation load 2011-12 2012-13 2013-14 2014-15

MVA 335.8 346.6 358.1 369.9

Maximum demand growth (%) 3.29 3.22 3.30 3.30


5.20 This forecast of network demand growth for the Darwin-Katherine system was derived

from the demand forecasts developed by PWC Networks for each bulk and zone

substation. A forecast is not presented for 2010-11 due to some uncertainty about the

transfer of demand between substations.

5.21 A network demand forecast could not be developed for the Alice Springs and Tennant

Creek networks as loading information for the Sadadeen, Ron Goodin and Tennant

Creek substations was not available. The loading of these substations depends on

generation dispatch patterns. The Commission expects that loading information for

these substations will be available for future Reviews.

Energy use forecasts and load factor

5.22 The energy use forecasts developed by PWC Generation have been used to determine

the load factor for each network. The load factor is the ratio of average demand over a

year to maximum demand and represents the rate of change in energy use relative to

maximum demand. The load factor indicates if maximum demand is likely to be more

or less “peaky”. The load factors for the Darwin-Katherine, Alice Springs and Tennant

Creek networks indicate:

• energy use is forecast to increase at a marginally higher rate than maximum

demand in the Darwin-Katherine system; and

• energy use is forecast to increase at a lower rate than maximum demand in the

Alice Springs and Tennant Creek systems.

5.23 The implication is that peak demand in the Alice Springs and Tennant Creek networks

will increase at a faster rate than energy use, raising the prospect of network

constraints in the medium term. Energy use in the Darwin-Katherine network is not

considered likely to present as great an influence on peak demand in the medium term.

Transmission/sub-transmission network capacity and constraints

5.24 The Commission considers that the transmission/sub-transmission network comprises:

• all 66 kV and above feeders;

43

March 2011

• bulk and zone substations with a highest voltage of 66kV or above; and

• distribution substations (e.g. with a voltage of 11/22kV) that perform a

sub-transmission role.

5.25 The Commission acknowledges that transmission/sub-transmission assets are not

currently specifically identified as such, but considers that these assets play a critical

role in network reliability and security due to the radial design of the network and

limited number of alternative flow paths. Hence, the Commission will continue to place

a specific focus on the components of the transmission/sub-transmission network.

Feeders

5.26 PWC Networks was not able to provide loading information for the

transmission/sub-transmission feeders, preventing a complete assessment of feeder

utilisation and adequacy (i.e. the ratio of maximum demand to the allocated rated

capacity of the equipment).

5.27 However, a high level assessment of capacity and constraints in the Darwin-Katherine

system has been undertaken due to the criticality of the transmission/sub-transmission

network to security of supply. The assessment was undertaken by Evans & Peck by

inferring feeder loadings under peak demand conditions using zone substation loading

data for the following sub-systems of the Darwin-Katherine system:

• the Berrimah sub-system, consisting of the Hudson Creek-Berrimah-Hudson Creek

loop;

• the City sub-system, consisting of City Zone, Snell Street, Casuarina, Frances Bay

and Leanyer substation service areas;

• the Palmerston sub-system, consisting of Archer, Weddell, Palmerston, McMinn’s,

Humpty Doo, Marrakai and Mary River substation service areas; and

• the Manton sub-system, consisting of Manton, Batchelor, Pine Creek, Katherine,

Edith River, Cosmo, Brock’s Creek and Union Reef substation service areas.

5.28 The analysis indicates a potential capacity constraint in the Palmerston sub-system,

with potential overloading of the Hudson Creek-Palmerston and Hudson

Creek-McMinn’s 66 kV network under first contingency conditions (N-1) in 2012-13 and

2013-14. However, this constraint is expected to be relieved on the completion of

Archer zone substation in early 2011. The potential for overloading may also be

managed by using the low voltage distribution network to transfer load.

5.29 The Commission cautions that the assessment relies on a number of simplifying

assumptions and is presented to provide a high level indication of capacity and

potential capacity constraints. The Commission expects to provide a more authoritative

assessment in future Reviews as the necessary data becomes available.

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March 2011

Bulk and zone substations

5.30 There are 28 bulk and zone substations across the Darwin-Katherine, Alice Springs

and Tennant Creek systems, with an assessment of substation utilisation possible for

25 substations.19 Substation capacity and potential constraints have been measured by

examining the substation utilisation:

• with all network elements (i.e. transformers) in service (an N rating); and

• with one network element out of service (an N-1 rating).

5.31 With all transformers in service, all zone substations should have sufficient capacity to

meet forecast load for 2010-11 except for the Snell Street zone substation which faces

an emerging capacity constraint.

5.32 Chart 5.1 presents zone substation utilisation under N-1 conditions (one transformer

out of service) in 2010-11 and 2013-14, based on forecast loads and system

configuration in 2010-11 and 2013-14.

Chart 5.1: Projected substation utilisation in 2010-11 and 2013-14 (N-1 conditions)


5.33 Under N-1 conditions, five substations face capacity constraints in 2010-11 and

2013-14:

• Berrimah 66/11 kV, with 99 per cent utilisation in 2010-11 and 2013-14. PWC

Networks is planning construction of a new East Arm substation (operating from

circa 2015-16) to support the Berrimah substation;

19

Loading information is not available for the Sadadeen, Ron Goodin and Tennant Creek zone substations.

45

March 2011

• Centre Yard 66/11 kV, with 100 per cent utilisation in 2010-11 and 120 per cent

utilisation in 2013-14. Centre Yard is a small (0.5 MVA) substation where PWC

Networks is considering supplementing capacity by relocating spare transformers;

• Palmerston 66/11 kV, with 115 per cent utilisation in 2010-11 and 97.5 per cent

utilisation in 2013-14. The Palmerston substation will be supported by the new

Archer zone substation (expected to be operational in 2011) and load transfer

through the low voltage distribution network;

• Katherine 132/22 kV, with 107 per cent utilisation in 2010-11 and 109.6 per cent

utilisation in 2013-14. The Katherine substation is supported by Pine Creek and

Katherine generation. Accounting for this generation should resolve the apparent

constraint; and

• Snell Street 66/11 kV, with 106.6 per cent utilisation in 2010-11 and 116.4 per cent

utilisation in 2013-14. Snell Street represents the most critical constraint due to its

role supplying the Darwin CBD. PWC Networks intends a replacement substation

to be operating from circa 2011-12.

5.34 Based on the information available to the Commission the PWC Networks network

planning policy requires only Berrimah, Katherine and Snell Street substations to meet

an N-1 event.

5.35 Additionally, under N-1 conditions, the Weddell, McMinns and Lovegrove substations

utilisation rates exceed 80 per cent in 2013-14 (88 per cent, 86 per cent and 82 per

cent respectively), indicating the potential for capacity constraints in the future.

5.36 Although industry practice for assessing potential network constraints focuses on the

implications of the first contingency event (i.e. an N-1 event), Evans & Peck advised

the Commission that the poor condition of network infrastructure20 means that there is

a credible risk that multiple contingency events could arise.

5.37 In particular, the Commission notes that the poor condition of equipment at the City

Zone and Snell Street substations makes a multiple contingency event a possibility

which warrants a continued priority being given to the capital program associated with

the development of Frances Bay substation, upgrade of Snell Street substation and

replacement of City Zone substation.

Distribution network capacity and constraints

5.38 PWC Networks was not able to provide the load flow studies or measurements on the

low voltage (11/22 kV) distribution network necessary for an assessment of loading

and capacity.

5.39 Similarly, PWC Networks was not able to provide loading or capacity information for

distribution substations. Consequently, the Commission is unable to identify if there are

any actual or potential constraints in the distribution network.

20

As identified through the Independent Enquiry into Casuarina Substation Events and Substation Maintenance Across Darwin (the Davies Enquiry) and being addressed through the PWC Remedial Asset Management Program.

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March 2011

5.40 Monitoring of distribution substation loading and capacity is currently based on the

incidence of voltage complaints or overloads which activate protection schemes. This

has been a common approach across the industry, but emerging industry practice is to:

• integrate information technology into distribution substations to record and report

loading, quality of supply, status and fault indication data in real time; and

• integrate geographic information systems with network topology and customer

billing information to determine the energy use through individual assets, which can

then be combined with standard load profiles to determine substation utilisation.

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March 2011

CHAPTER 6

Customer service and reliability performance

6.1 This chapter reports on customer service performance and reliability of supply

outcomes in 2009-10 in the Darwin-Katherine, Alice Springs and Tennant Creek

systems.

6.2 Customer service performance and reliability of supply information is reported by PWC

Generation, PWC Networks and PWC Retail as a requirement of the Territory’s

Electricity Standards of Service Code. The 2009-10 Standards of Service: Key Service

Performance Indicators Report covers:

• network and generation reliability performance, and network feeder performance; and

• customer service performance, such as network reconnections/new connections, the time taken to answer telephone calls, and customer complaints about quality of supply and service (e.g. billing).

Reliability performance

6.3 Reliability performance is measured by calculating:

• the system average interruption duration index (SAIDI), which indicates the average duration of network and generation related outages experienced by a customer; and

• the system average interruption frequency index (SAIFI), which indicates the average number of network and generation related outages experienced by a customer.

6.4 The Commission has examined reliability performance for:

• generation and network performance in the Darwin region and Katherine region (of the Darwin-Katherine system), Alice Springs and Tennant Creek systems for 2005-06 to 2009-10, using a weighted total average of reliability outcomes for each system; and

• central business district (CBD), urban, short rural and long rural feeders for 2009-10 only, using a weighted total average of feeder reliability for each system.

Overall reliability performance

6.5 Chart 6.1 shows the average total minutes off supply for a customer in the Darwin,

Katherine, Alice Springs and Tennant Creek (combined) systems for 2005-06 to

2009-10.

6.6 The key points highlighted by chart 6.1 are:

• the lack of clear trend in the underlying network reliability performance (SAIDI) over the five year period 2005-06 to 2009-10; and

• the significant contribution of “exclusions” to the weighted total average minutes off supply for 2007-08, 2008-09 and 2009-10.

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March 2011

Chart 6.1: PWC Networks weighted total average minutes off supply (SAIDI) for 2005-06 to 2009-10


6.7 Chart 6.2 shows the average total frequency of outages for a customer (SAIFI) in the

Darwin, Katherine, Alice Springs and Tennant Creek (combined) systems for 2005-06

to 2009-10.

6.8 The key points highlighted by chart 6.2 are:

• the high frequency of generation related outages compared to the experience of customers elsewhere in Australia;

• the lack of a clear trend in the underlying network reliability performance (SAIFI) over the five year period 2005-06 to 2009-10;

• a smaller contribution of “exclusions’ to the weighted total average frequency of outages than for SAIDI, indicating a small number of events with a large impact.

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March 2011

Chart 6.2: PWC Networks weighted total average frequency of outages (SAIFI) for 2005-06 to 2009-10


Generation performance trend

6.9 Territory customers experienced an average of 2.7 generation related outages a year

(SAIFI) between 2005-06 and 2009-10. This is significantly more than observed in the

NEM connected systems (e.g. for the 12 months ended 31 March 2010, Ergon Energy

reported a SAIFI of 0.02).

6.10 So as to develop an improved understanding of generation reliability performance,

Evans & Peck examined under frequency loss of supply (UFLS) events for the period

2005-06 to 2009-10 (to 28 November 2010). For the Darwin-Katherine system:

• there was an average of 28 UFLS events over the five year period, which represents an average of over one UFLS event each fortnight;

• the number of UFLS events peaked in 2008 with 49 events, but has fallen to 20 in 2010.

6.11 The analysis identified a number of possible causes for the high number of generation

related outages, but could not identify the specific cause(s) from the range of

possibilities, including operating practice, spinning reserve policy and asset condition

and maintenance. The Commission expects generation reliability performance to

improve in the coming years with the commissioning of new generation plant

(especially Channel Island sets 8 and 9) and the major maintenance to existing

generation plant.

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March 2011

6.12 The Commission will continue to monitor generation performance through regular

performance reporting and an incident reporting framework now being finalised. The

Commission will report on progress in future Reviews.

Network performance trend

6.13 There is no clear trend in network reliability performance in the SAIDI and SAIFI

outcomes for 2005-06 to 2009-10.

6.14 The Commission requested PWC Networks to report reliability performance for

2009-10 based on feeder type, consistent with the approach adopted across

Australia:21

• CBD – a feeder predominantly supplying commercial, high-rise buildings, supplied

by a predominantly underground distribution network containing significant

interconnection and redundancy when compared to urban areas. PWC Networks

had 34 CBD feeders at 30 June 2010;

• Urban – a feeder, which is not a CBD feeder, with actual maximum demand over

the reporting period per total feeder route length greater than 0.3 MVA/km. PWC

Networks had 30 urban feeders at 30 June 2010;

• Short Rural – a feeder which is not a CBD or urban feeder, with a total feeder route

length less than 200km. Rural short feeders may include feeders in urban areas

with low load densities. PWC Networks had 105 short rural feeders at 30 June

2010; and

• Long Rural – a feeder which is not a CBD or urban feeder with a total feeder route

length greater than 200km. PWC Networks had 2 rural long feeders at 30 June

2010.

6.15 Examining feeder performance to identify network performance trend is the accepted

approach in Australia. As 2009-10 is the first year this data has been reported for the

Territory, there is no time series data to compare reliability performance in the Territory

over time. The Commission will report reliability performance by feeder type in future

Reviews.

6.16 Charts 6.3 and 6.4 present the relative performance of each feeder category for the

(combined) Darwin-Katherine, Alice Springs and Tennant Creek systems for 2009-10.

21

Feeder performance is most commonly reported based on feeder type. The approach is documented in the Utility Regulator’s Forum, 2002, National Regulatory Reporting for Electricity Distribution and Retailing Businesses.

51

March 2011

Chart 6.3: PWC Networks average outage duration (SAIDI) by feeder category for 2009-10


Chart 6.4: PWC Networks average frequency of outages (SAIFI) by feeder category for 2009-10


52

March 2011

6.17 To assess relative performance of PWC Networks with regulatory expectations

elsewhere in Australia, the Commission has compared PWC Network “normalised”22

performance with the minimum service standards applicable in Queensland. The

Commission considers the two Queensland electricity networks to provide a

reasonable point of comparison to PWC Networks (particularly Ergon Energy).

6.18 Charts 6.5 and 6.6 present a comparison of feeder performance in the Territory with

the Queensland minimum service standards.23

Chart 6.5: Feeder performance (SAIDI) 2009-10 – PWC Networks (actual) and Queensland (minimum

service standard

Source: Evans & Peck

6.19 The Commission has the following observations about the comparison of SAIDI

performance:

• the PWC Networks CBD feeder performance is marginally worse than the Energex

CBD minimum standard (Energex CBD performance for 2009-10 was 1.2 SAIDI

minutes). CBD feeder performance is variable across Australia and volatile

between years. A single event can have a significant influence on performance.

22

Normalised means planned and unplanned outages excluding major event days.

23 2009-10 Ergon Energy urban, short rural and long rural standards and the Energex CBD standard (Ergon

Energy has no CBD feeders). Refer Queensland Competition Authority, October 2010, Report on performance against minimum service standards and compliance with guaranteed service levels by Energex and Ergon Energy for the 2009-10 financial year.

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March 2011

The PWC Network CBD feeder performance is considered to be consistent with

outcomes Australia wide;

• PWC Networks urban and short rural performance is better than the Ergon Energy

minimum standards (Ergon performance for 2009-10 was 221.7 SAIDI minutes for

urban and 542.9 SAIDI minutes for short rural); and

• PWC Network long rural performance is worse than the Ergon Energy minimum

standard (Ergon performance for 2009-10 was 995.2 SAIDI minutes). However, the

small number of long rural feeders in the Territory could cause high statistical

variation. The individual feeder performances should be judged on relative length

and technical configuration.

Chart 6.6: Feeder performance (SAIFI) 2009-10 – PWC Networks (actual) and Queensland (minimum

service standards

Source: Evans & Peck

6.20 The Commission has the following observations about the comparison of SAIFI

performance:

• PWC Networks CBD, urban and short rural SAIFI performance is marginally worse

than the Energex/Ergon Energy minimum standards (Energex performance for

2009-10 was 0.08 outages for CBD, and Ergon performance for 2009-10 was 2.3

outages for urban and 4.6 outages for short rural). This is considered generally

consistent with regulatory expectations across Australia; and

• PWC Networks long rural SAIFI performance is much worse than the Ergon Energy

standard (Ergon performance for 2009-10 was 7.2 outages).

6.21 In future Reviews the Commission intends to compare feeder performance in the

Territory over time and with that of like network service providers elsewhere in

Australia.

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March 2011

Exclusions

6.22 Exclusions are events that have been identified using the 2.5 Beta method, which is a

methodology developed by the Institute of Electrical and Electronic Engineers (IEEE) to

statistically identify reliability events that may not represent business as usual and

distort the underlying reliability trend. This is the method commonly used in Australia.

6.23 Notwithstanding that the terminology used is “exclusions” or excluded events, this does

not mean that the cause or consequences of the event should be ignored. Each

excluded event should be the subject of a review so as to provide a detailed

understanding of the event.

6.24 Although the 2.5 Beta method removes some statistical variability, reliability

performance is still probabilistic and influenced by weather, equipment failure, actions

by third parties and animals. However, a review of trends gives some insight as to

whether reliability performance is stable, improving or deteriorating.

Darwin region reliability performance

6.25 Darwin region reliability performance for each quarter for 2007-08 to 2009-10 is

presented in Charts 6.7 and 6.8.

6.26 The SAIDI performance in 2009-10 was 494.9 minutes off supply, comprising 61.2

minutes due to generation, 196.2 minutes due to networks and 237.6 minutes due to a

major event (when a lightning strike to the two transmission lines from the Channel

Island power station on 30 January 2010 led to the Darwin-Katherine system black).

Chart 6.7: Average outage duration for a Darwin customer 2007-08 to 2009-10 (quarterly)


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March 2011

6.27 The average frequency of outages experienced by a customer (SAIFI performance) in

2009-10 was 7.1, comprising 2.3 outages due to generation, 4.0 outages due to

networks and 0.8 outages due to the system black.

Chart 6.8: Average frequency of outages for a Darwin customer 2007-08 to 2009-10 (quarterly)


Katherine region reliability performance

6.28 Katherine region reliability performance for each quarter for 2007-08 to 2009-10 is


6.29 SAIDI performance in 2009-10 was 211.9, comprising 10.4 minutes due to generation

and 201.5 minutes due to networks.

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March 2011

Chart 6.9: Average outage duration for a Katherine customer 2007-08 to 2009-10 (quarterly)


6.30 SAIFI performance in 2009-10 was 6.6, with 1.0 outage due to generation and 5.5

outages due to networks.

Chart 6.10: Average frequency of outages for a Katherine customer 2007-08 to 2009-10 (quarterly)


57

March 2011

Alice Springs region reliability performance

6.31 Alice Springs reliability performance for each quarter for 2007-08 to 2009-10 is


6.32 SAIDI performance in 2009-10 was 231.9, with 23.4 minutes due to generation and

208.5 minutes due to networks.

Chart 6.11: Average frequency of outages for an Alice Springs customer 2007-08 to 2009-10 (quarterly)


6.33 SAIFI performance in 2009-10 was 5.5, with 1.8 outages due to generation and 3.7


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March 2011

Chart 6.12: Average frequency of outages for an Alice Springs customer 2007-08 to 2009-10 (quarterly)


Tennant Creek reliability performance

6.34 Tennant Creek reliability performance for each quarter for 2007-08 to 2009-10 is


6.35 SAIDI performance in 2009-10 was 188.7, with 31.2 minutes due to generation and

157.5 minutes due to networks.

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March 2011

Chart 6.12: Average frequency of outages for a Tennant Creek customer 2007-08 to 2009-10 (quarterly)


6.36 SAIFI performance in 2009-10 was 7.5, with 1.0 outage due to generation and 6.5


Chart 6.13: Average frequency of outages for a Tennant Creek customer 2007-08 to 2009-10 (quarterly)


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March 2011

Customer service performance

6.37 The customer service performance of PWC Networks and PWC Retail is measured

using the following indicators:

• the time taken to complete reconnections and new connections;

• the number of complaints about quality of electricity supply;

• the time taken to answer telephone calls (after the customer has chosen to speak to an operator);

• the number of complaints about PWC Networks and PWC Retail customer service

Reconnections / connections

6.38 PWC Networks reports on the percentage of reconnections and connections of

customers that occur after a defined time period:

• reconnections are to occur within 24 hours (connections to a property where there is an existing supply and no extension or augmentation of the network needed);

• connections to a property in a new subdivision in an urban area are to occur within five working days; and

• connections to a property in a new subdivision in an urban area where minor extension or augmentation of the network is required are to occur within 10 weeks

6.39 The percentage of reconnections and connections not occurring within the defined

timeframe for 2005-06 to 2009-10 is presented in Table 6.1.

Table 6.1: Percentage of reconnections / connections not made within the specified time limit

All customers (% not made) 2005-06 2006-07 2007-08 2008-09 2009-10

Reconnections (existing) 0 1 1 0.8 0.5

Connections (new subdivision) 7 19.3 16 8.7 7.9

Connections (extension needed) 30 31.5 32 66.5 69.4

Source: Power and Water Corporation.

6.40 The number of connections to a property in a new subdivision is 92.1 per cent,

continuing the improvement in the number occurring in time from the low point of 80.7

per cent recorded in 2006-07.

6.41 The number of connections where minor works are required was 30.6 per cent, which

is worse than in 2008-09 and the worst result in the five year period. This result could

be attributed to a diversion of resources from routine works to the PWC Networks

remedial asset management program.

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March 2011

Quality of supply complaints

6.42 PWC Networks reports the number of complaints received in relation to quality of

supply (e.g. voltage dips, swells and spikes). Table 6.2 presents the number of quality

of supply complaints for 2006-07 to 2009-10. No data was reported for 2005-06.

Table 6.2: Quality of supply complaints

Number of complaints 2005-06 2006-07 2007-08 2008-09 2009-10

Northern (Darwin) NA NA 801 792 776

Katherine NA NA 194 109 317

Southern (Alice Springs) NA NA 96 139 114

Tennant Creek NA NA 26 21 77

Total NA 1029 1117 1061 1284


6.43 The data show a significant increase in complaints in Katherine and Alice Springs

between 2008-09 and 2009-10. No reason has been given by PWC.

Telephone call response

6.44 PWC (Networks and Retail) report the number and percentage of telephone calls

responded to within 20 seconds of the customer selecting to speak to a human

operator.

6.45 Table 6.3 presents the percentage and number of telephone calls answered within 20

seconds of the customer choosing to speak to a human operator for 2005-06 to

2009-10.

Table 6.3: Percentage and number of telephone calls answered within timeframe

Telephone calls answered 2005-06 2006-07 2007-08 2008-09 2009-10

Percentage 76 69 58 62 63

Number 113 871 96 562 78 453 87 013 91 614


6.46 The 2009-10 result represents an improvement from 2008-09, but is below the 76 per

cent achieved in 2005-06.

Customer complaints

6.47 PWC (Networks and Retail) report the number of complaints received from

customers.24

6.48 Table 6.4 gives the number of customer complaints received by PWC Networks and

PWC Retail for the period 2005-06 to 2006-07.

24

A complaint is (as defined in the Australian Standard ISO10002-2006) ‘an expression of dissatisfaction made to an organisation, related to its products, or the complaint handling process itself, where a response or resolution is explicitly or implicitly expected’.

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March 2011

Table 6.4: Number of customer complaints

Number of complaints 2005-06 2006-07 2007-08 2008-09 2009-10

Darwin NA NA 1778 1718 1830

Katherine NA NA 121 160 160

Alice Springs NA NA 391 318 417

Tennant Creek NA NA 42 39 70

Total 2907 1917 2332 2235 2477


6.49 PWC received 2477 electricity service related complaints during 2009-10, the highest

number received since 2005-06.

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March 2011

APPENDIX A

System maximum demand forecasts 2010-11 to 2019-20

Table A.1: Forecast Darwin-Katherine annual maximum system demand for 2010-11 to 2019-20

MW per annum E&P (medium – 2.8%) PWC (medium – 2.2%) PWC (high – 2.6%)

2009-10 (actual) 273.4 273.4 273.4

2010-11 281.1 279.4 280.5

2011-12 288.9 285.6 287.8

2012-13 297.0 291.9 295.3

2013-14 305.3 298.3 303.0

2014-15 313.9 304.8 310.9

2015-16 322.7 311.5 318.9

2016-17 331.7 318.4 327.2

2017-18 341.0 325.4 335.7

2018-19 350.5 332.6 344.5

2019-20 360.4 339.9 353.4


Table A.2: Forecast Alice Springs annual maximum system demand for 2010-11 to 2019-20

MW per annum E&P (medium – 1.7%) PWC (medium – 1.2%) PWC (high – 1.6%)

2009-10 (actual) 54.9 54.9 54.9

2010-11 55.9 55.6 55.8

2011-12 56.8 56.3 56.7

2012-13 57.8 57.0 57.6

2013-14 58.8 57.6 58.6

2014-15 59.8 58.3 59.5

2015-16 60.8 59.0 60.4

2016-17 61.8 59.7 61.4

2017-18 62.9 60.5 62.4

2018-19 64.0 61.2 63.4

2019-20 65.0 61.9 64.4


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March 2011

Table A.3: Forecast Tennant Creek annual maximum system demand for 2010-11 to 2019-20

MW per annum E&P (medium – 2.0%) PWC (medium–0.64%) PWC (high – 1.1%)

2009-10 (actual) 7.4 7.4 7.4

2010-11 7.5 7.4 7.5

2011-12 7.7 7.5 7.5

2012-13 7.8 7.5 7.6

2013-14 8.0 7.6 7.7

2014-15 8.1 7.6 7.8

2015-16 8.3 7.7 7.9

2016-17 8.5 7.7 8.0

2017-18 8.6 7.8 8.0

2018-19 8.8 7.8 8.1

2019-20 9.0 7.9 8.2


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March 2011

Zone Substations - Number Max. Min. Max. Firm Min. Firm

Northern & Southern Regions of Capacity Capacity Capacity Capacity Demand Demand Demand Demand Demand Demand Demand Demand Demand

Transformers MVA1

MVA1

MVA2

MVA2 MVA MVA MVA MVA MVA MVA MVA MVA MVA

Palmerston 11/22kV 1 7.5 7.5 0.0 0.0 5.0 5.3 5.6 5.7 5.9 6.0 6.2 6.3 6.5

McMinns 66/22kV 3 40.5 30.0 27.0 20.0 21.1 20.4 20.7 21.3 21.9 22.6 23.2 23.9 24.6

Weddell 66/22kV 2 10.0 10.0 5.0 5.0 - 6.0 6.0 6.2 6.3 6.5 6.6 6.8 7.0

Humpty Doo 66/22kV 3 7.5 7.5 5.0 5.0 1.5 1.5 1.6 1.6 1.7 1.7 1.8 1.8 1.9

Mary River 66/22kV 1 5.0 5.0 0.0 0.0 1.3 1.3 1.3 1.3 1.4 1.4 1.4 1.5 1.5

Marrakai 66/22kV 2 5.0 5.0 2.5 2.5 - - - 1.5 1.5 1.5 1.6 1.6 1.7

Manton 132/22kV 1 27.0 20.0 0.0 0.0 6.0 5.6 5.7 5.8 6.0 6.1 6.3 6.4 6.6

Batchelor 132/22kV 1 27.0 20.0 0.0 0.0 11.0 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2

Pine Creek 11/66kV 2 40.0 40.0 20.0 20.0 3.7 3.8 3.9 4.0 4.1 4.2 4.3 4.4 4.5

Katherine 132/22kV 2 54.0 40.0 27.0 20.0 25.6 28.6 28.8 29.0 29.2 29.4 29.6 29.8 30.0

Berrimah 66/11kV 2 76.0 50.0 38.0 25.0 35.6 36.1 36.1 37.7 34.4 36.0 37.6 39.3 41.0Leanyer 66/11kV

32 54.0 40.0 27.0 20.0 - - - - 15.0 15.5 16.0 16.5 17.0

Casuarina 66/11kV 3 114.0 75.0 76.0 50.0 47.9 44.6 32.3 52.2 43.9 45.3 46.7 48.2 49.8

Snell Street 66/11kV 4 47.0 40.0 35.0 30.0 41.1 36.7 36.2 37.3 38.4 39.6 40.7 42.0 43.2

City Zone 66/11kV 3 120.0 90.0 80.0 60.0 61.3 62.1 61.3 42.6 43.6 44.5 45.5 46.5 47.6Frances Bay 66/11kV

31 40.0 30.0 0.0 0.0 - - - 20.0 20.4 20.9 21.3 21.8 22.3

Centre Yard 66/11kV 2 1.0 1.0 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.6 0.6 0.6

Palmerston 66/11kV 2 80.0 60.0 40.0 30.0 43.3 42.6 43.1 46.0 34.2 36.5 39.0 41.6 44.4Archer 66/11kV

32 54.0 40.0 27.0 20.0 - - - - 15.0 16.0 17.1 18.3 19.5

Pine Creek 11/22kV 4 10.0 10.0 7.5 7.5 0.7 0.7 0.7 0.7 0.7 0.8 0.8 0.8 0.8

Union Reef 66/11kV 1 12.5 10.0 0.0 0.0 11.1 11.1 11.1 11.1 11.1 11.1 11.1 11.1 11.1

Brocks Creek 66/11kV 2 7.0 7.0 3.5 3.5 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1

Cosmo Howley 66/11kV 2 15.0 15.0 7.5 7.5 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.3

Alice Springs - Lovegrove 22/11kV 3 35.0 25.0 20.0 15.0 15.1 15.1 15.5 15.9 16.3 16.7 17.1 17.5 18.0

Alice Springs - Sadadeen 22/11kV4

2 38.0 30.0 19.0 15.0 n/a n/a n/a n/a n/a n/a n/a n/a n/a Alice Springs - Ron Goodin

4n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

Tennant Creek4

2 15.0 15.0 7.5 7.5 n/a n/a n/a n/a n/a n/a n/a n/a n/a

Network - Substation Totals 55 942.0 723.0 475.0 364.0 332.1 322.5 310.9 341.2 352.1 363.4 375.2 387.4 400.2

Notes:

1. Maximum and minimum capacity are based on the ratings of the substation transformers.

2. Based on N-1 contingency criteria (i.e. the loss of one transformer). Example: Pine Creek Zone Substation consists of 2 transformers rated at 20 MVA; if one transformer fails the minimum firm capacity is 20 MVA.

3. Actual and forecast demand commences from completion of construction of the zone substation.

4. Sadadeen, Ron Goodin and Tennant Creek are stations with generators. Loading on the transformers depends on the generators dispatched.

5. Load will be shared between adjacent zone substations in the cases where the minimum firm capacity is less than demand to avoid potential load shedding.

2013-14 2014-152007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2015-16

APPENDIX B Zone substation demand for 2007-08 to 2015-16


power system review - utilities commission power system review...projected available generation...

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